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Nam Tai Property Inc. Reports Q1 2018 Results

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Nam Tai Property Inc. Reports Q1 2018 Results

PR Newswire

SHENZHEN, April 30, 2018 /PRNewswire/ -- Nam Tai Property Inc. ("Nam Tai" or the "Company") (NYSE Symbol: NTP) today announced its unaudited results for the first quarter ended March 31, 2018.  

KEY HIGHLIGHTS

(In thousands of US dollars, except per share data, percentages and as otherwise stated)






Quarterly Results



Q1 2018



Q1 2017



YoY(%) (b)

Operation income


$

--



$

594




(100)

Net operation income


$

--



$

594




(100)

% of operation income



--




100.0%





Operating loss


$

(9,116)



$

(1,390)




--

% of operation income



--




(234.0%)





per share (diluted)


$

(0.24)



$

(0.04)




--

Net income (a)


$

2,568



$

1,814




42

% of operation income



--




305.4%





Basic income per share


$

0.07



$

0.05




40

Diluted income per share


$

0.07



$

0.05




40

Weighted average number of shares ('000)












Basic



37,669




36,466





Diluted



38,527




36,990















Notes:




















(a)     Net income for the three months ended March 31, 2018 mainly included a gain of $6.8 million on disposal of property located in Hong
Kong and exchange gain of $3.3 million as a result of the appreciation of Renminbi against the US dollar in
the first quarter of 2018 and
interest income of $1.5 million earned from time deposits; but partly offset by general and administrative expenses of $9.1 million, which
mainly included accrual of compensation for loss of office of $3.7 million for the anticipated retirement of a senior manager and option
expenses of $1.4 million for certain new officers and employees, salary & benefits of $1.8 million, depreciation of $1.0 million and audit
and legal & professional fees of $0.6 million.

(b)     Percentage change is not applicable if either of the two periods contains a loss.

(c)     Capitalization on project investment was $2.0 million for the first quarter of 2018, our accumulated project investment was $56.2 million
up to March 31, 2018, which was recorded under the account of real estate properties under development in the balance sheet as of March
31, 2018.

(d)     This information has been published on the Company's website http://www.namtai.com/investors#investors/quarterly_earnings under the
quarterly earnings report of
the first quarter of 2018 on page 7, Condensed Consolidated Statements of Comprehensive Income.

SUPPLEMENTARY INFORMATION (UNAUDITED) IN THE FIRST QUARTER OF 2018

Key Highlights of Financial Position










As of March 31,


As of December 31,


As of March 31,



2018


2017


2017

Cash, cash equivalents and short term

investments


$173.2 million(a) (b)


$165.2 million


 $182.7 million

Ratio of cash(c) to current liabilities


10.61


9.32


18.15

Current ratio


10.94


9.61


20.47

Ratio of total assets to total liabilities


16.67


14.79


24.79

Return on equity



4.1%



1.6%


3.1%

Ratio of total liabilities to total equity


0.06


0.07


0.04










Notes:


















(a)     Compared to December 31, 2017, the increase of $8.0 million in the cash, cash equivalents and short-term investments was mainly due to
the proceeds of $9.7 million from selling an office property in Hong Kong, exchange gain of $5.8 million as a result of the appreciation of
Renminbi against the US dollar during the three months ended March 31, 2018, and proceeds of $1.4 million from shares issued upon the
exercise of certain share options; offset in part by $4.3 million used for land development projects that was recorded under the item real
estate properties under development in the balance sheet as of March 31, 2018 and a decrease of $2.6 million for dividend payment.
 

(b)     Compared to March 31, 2017, the decrease of $9.5 million in the cash, cash equivalents and short-term investments was mainly due to
$14.9 million used for land development projects that was recorded under the item real estate properties under development in the balance
sheet as of March
31, 2018, the payments of $13.4 million for new office premises and the payments of $10.3 million for dividend payment;
offset in part by the exchange gain of $14.2 million as a result of the appreciation of Renminbi against the US dollar from March 31, 2017
to March 31, 2018, the proceeds of $9.7 million from selling an office property in Hong Kong, and proceeds of $7.9 million from shares
issued upon the exercise of certain share options.

(c)     Cash in the financial ratio included cash, cash equivalents and short-term investments in the amount of $173.2 million, $165.2 million and
$182.7 million as of March 31, 2018, December 31, 2017 and March 31, 2017, respectively.

OPERATING RESULTS

Operating loss for the first quarter of 2018 was $9.1 million, an increase of $7.7 million, compared to operating loss of $1.4 million in the first quarter of 2017, when there was rental income derived from our land and buildings located in Gushu, Shenzhen, prior to the expiration of its lease agreement in October 2017, to offset the operating loss.

Net income for the first quarter of 2018 was $2.6 million compared to a net income of $1.8 million in the first quarter of 2017. Net income for the first quarter of 2018 mainly consisted of a gain of $6.8 million on disposal of an office property in Hong Kong, exchange gain of $3.3 million as a result of the appreciation of Renminbi against the US dollar in the first quarter of 2018, interest income of $1.5 million earned from time deposits; offset in part by general and administrative expenses of $9.1 million that mainly included accrual of compensation for loss of office of $3.7 million for the anticipated retirement of a senior manager and option expenses of $1.4 million for certain new officers and employees, salary & benefits of $1.8 million, depreciation of $1.0 million and audit, legal & professional fees of $0.6 million. Net income for the first quarter of 2017 mainly consisted of interest income of $2.5 million earned from time deposits, exchange gain of $0.8 million as a result of the appreciation of Renminbi against the US dollar in the first quarter of 2017, and net operation income of $0.6 million; offset in part by general and administrative expenses of $2.0 million that mainly included salary & benefit of $1.0 million, option expenses of $0.2 million, and audit, legal & professional fees of $0.2 million. Net income per diluted share for the first quarter of 2018 was $0.07 compared to net income per diluted share of $0.05 for the first quarter of 2017.

As the majority of our assets are denominated in Renminbi, the translation of Renminbi denominated assets to US dollars for reporting purposes has resulted in foreign exchange gain for the three months ended March 31, 2018. Due to the fluctuation of exchange rate for Renminbi against the US dollar, foreign exchange gain for the three months ended March 31, 2018 was $3.3 million, or approximately 126.7% of the amount of our net income for this period. However, since the majority of our payment obligations are also denominated in Renminbi, we do not expect the movement of Renminbi against the US dollar to materially or adversely impact our business. Nevertheless, investors should consider that the purchasing power of US dollar figures for cash and cash equivalents and other short-term investments is not identical from period to period.

Capitalization on project investment was $2.0 million for first quarter of 2018, our accumulated project investment was $56.2 million up to March 31, 2018, which was recorded under the item real estate properties under development in the balance sheet as of March 31, 2018.

Our business of land development is currently in the preparatory stage where it takes time to apply for the relevant licenses and permits from the PRC government. During this preparatory stage of the land development, our only sources of income are from limited deposit interest; therefore, we expect to continue to incur operating losses as long as we are in this stage.

Please see page 7 of the Company's Condensed Consolidated Statements of Comprehensive Income for further details. This information has also been published on the Company's website at http://www.namtai.com/investors#investors/quarterly_earnings in the quarterly earnings report of the first quarter of 2018 on page 7, Condensed Consolidated Statements of Comprehensive Income.

COMPANY OUTLOOK

The development of Nam Tai Inno Park in Guangming, Shenzhen, and Nam Tai Inno City in Gushu, Shenzhen, continues to proceed smoothly.

The construction of Nam Tai Inno Park continued with the excavation of its foundation and settlement of piles during the first quarter of 2018. The Company plans to select two main construction contractors in May of 2018, which, in turn, would allow the Company to receive the Construction Permit for the Main Structure as the next step. In any event, the Company will announce each of these important milestones in due course.

On April 10, 2018, the Company also announced the receipt of RMB1.2 billion ($184 million) credit facility from China Construction Bank to support the development of the Nam Tai Inno Park Project (the "Inno Park Financing Package") beyond the $173.2 million of cash, cash equivalents and short-term investments that the Company had on hand as of March 31, 2018. The Inno Park Financing Package is a part of the Strategic Cooperation Agreement that the Company entered into with China Construction Bank on August 18, 2016, where China Construction Bank planned to offer a total credit facility of up to RMB5.0 billion to the Company over a five years period for various projects, including Nam Tai Inno City as the next project. With the construction financing for Nam Tai Inno Park project secured, the Company will now focus on building Nam Tai Inno Park into a high-tech research & development center.

For Nam Tai Inno City, after splitting the development into Phase I and Phase II to cover the eastern and western sections, respectively, the Company continued with the demolition of its old factory buildings located on the eastern section in the first quarter of 2018. The Company currently focuses its development efforts on redesigning the complex to maximize its value based on the latest market outlook. The Company continues to follow its plan of development and expects to receive the Land Use Permit in June 2018 and Land Use Right Certificate in August 2018 for Phase I of Nam Tai Inno City. For Phase II of Nam Tai Inno City, as the Company now expects to receive its Construction Permit for the Main Structure around July 2020, the Company may look for ways to increase its utilization prior to the start of the construction.

For our Hong Kong office property, we sold it to our Chairman, Mr. Koo, for $9.7 million on February 12, 2018, after our Audit Committee reviewed two valuation reports prepared by two independent appraisers and our Board of Directors approved the transaction price.

As for the Wuxi facilities, the Company continues to search for both potential buyers or renters, with the primary focus on rental.

Following below are summaries of our Nam Tai Inno Park and Nam Tai Inno City projects:

Part I: Gross Floor Areas for the Two Projects:



Inno Park 


Inno City



(In square meters, except plot ratios)

Land area


103,739


52,625

Plot ratios


2.59


6.00



Office


175,406


Office + Soho


187,880



Apartment


61,000


Apartment


48,300

Gross floor area (GFA)


Commercial


28,594


Commercial


25,000



Other


4,159


Other


7,200





269,159




268,380

Underground floor area




62,673




80,000

Total construction floor area (CFA)




331,832




348,380




Remark


The above figures are subject to adjustment upon the final
approval of the relevant authorities in China.

Part II: Timetable for the Two Projects:



Main Certificates


Estimated Completion Date





Inno Park


Inno City

Phase I


Inno City

Phase II


2017


2018


2019


2020


2021


2022


2023

A


Land Use Permit


Obtained

June 2015


June 2018


Oct. 2019




    * 


#  









B


Land Use Right
Certificate


Obtained

Sep. 2015


Aug. 2018


Dec. 2019




 *  










C


Construction
Planning Permit


Obtained

Aug. 2017


Dec. 2018


June 2020


  ^ 


 *     




#







D1


Early Construction
Permit for Pile
Foundation


Obtained

May 2017


N/A


N/A


  ^













D2


Construction Permit
for the Main
Structure


May 2018


Jan. 2019


July 2020




   ^


  *


       #







D3


Construction Acceptance
Certificate for the
Main Structure


Oct. 2019


Oct. 2020


Feb. 2022






  ^ 


    *     




   #



D4


Construction
Completion


Oct. 2020


Nov. 2021


May 2023








  ^       


  *      




   #

E


Property Ownership
Certificate


Oct. 2020


Nov. 2021


May 2023








  ^    


     *   




   #
























Remarks


1. Carets ^ represent "Inno Park", while stars * represent "Inno City – Phase I" and  number signs # represent "Inno City – Phase II".



2. The construction of "Inno Park" has commenced from April 2017







3. The construction of "Inno City" is expected to commence before December 2018.





Part III: Budgetary Estimate for the Two Projects:



Total Cost


Inno Park


Inno City







(US$ in million)


1


Construction Cost



312



415


2


Operation Cost



69



43




Total



$  381



$  458














Remark

 

The $839 million Schematic Design Estimation was prepared by our quantity
surveyor. This estimate will be used by us for cost control purposes to monitor the
costs of design, construction, and other operations.


This estimation does not include the costs of marketing and interior furnishing and
makes no adjustment for inflation or financing costs. If the developed properties are
offered for sale, the costs would also have to include payment for land appreciation
tax.

Potential Risks in Our Business

We currently derive a majority of our income from interest income. Since 2016, we have seen a stabilizing trend on the benchmark interest rates in China. However, due to the current economic conditions in China, we expect the People's Bank of China ("PBOC") to keep Renminbi-denominated official time deposit interest rates in China at a low level throughout 2018. We expect to continue to incur operating losses in the second quarter of 2018 and beyond. With this lower interest rate environment and continued decrease in our level of deposit, we expect our income offset against these operating losses to materially decrease in future periods, which will accelerate the current decline of our cash and cash equivalents and other short-term investments.

We have only become a real estate developer after our electronic manufacturing businesses ceased in 2014. To ensure our successful transformation, we have engaged external advisors and sought potential strategic partners and investors, including Kaisa, to support our projects. We cannot assure you our efforts will be sufficient enough to carry out a transformation of this magnitude. Our Chairman, Mr. Koo, is 74 years old. In accordance with our restructuring plan, Mr. Koo has begun his transition towards retirement in anticipation of age and health issues, including the appointment of Mr. Ying Chi Kwok as our Chief Executive Officer and Ms. Yu Zhang, in his place, as our Chief Financial Officer. We cannot assure you that our restructuring plan can be carried out smoothly, or that any successor will be able to manage our Company as effectively.

As the majority of our assets are denominated in Renminbi, the translation of Renminbi-denominated assets to US dollars for our reporting purposes has resulted in a foreign exchange gain in this quarter. As such, we do expect to see fluctuations in the reporting of foreign exchange loss/gain in the financial statements due to the movement of Renminbi against the US dollar. However, as a majority of our payments are in Renminbi, we also do not expect the movement of Renminbi against the US dollar to adversely impact our business. Nevertheless, investors should consider that the purchasing power of US dollar figures for cash and cash equivalents and other short-term investments is not identical from period to period.

In order for the projects to proceed smoothly, we will need to access additional funding. To do so, the Company will negotiate loans and credit lines with financial banks to source funds needed to assist in future development of the projects. These debt instruments often contain covenants limiting our flexibility in operating our business and can contain requirements that we meet certain milestones in our project development. While we have obtained the Inno Park Financing Package to support our financing in part, there can be no assurance that we can continue to enter into these instruments with financial institutions successfully or that, if we do, we will be able to comply with the covenants or milestones these instruments may require. Failure to enter into these loans or credit lines or to comply with any terms required by this funding may delay our developments as we seek alternative sources of funding or prevent us from completing the developments entirely.

As of March 31, 2018, we have a total cash balance of $173.2 million and no debt. With our current cash position and the receipt of the Inno Park Financing Package after the conclusion of the first quarter, we believe our finances remain sufficient to fund the initial stages of these property development projects for the construction of the main structure of Nam Tai Inno Park as currently planned. All of our land development related applications are subject to government policies and regulations in the real estate market. As this is our first venture into the land development projects, we may encounter industry-specific difficulties that result in losses as we progress with our projects in Shenzhen. As we are currently in the planning stage of our property projects, and can only generate limited interest income from cash deposits, we will continue to record operating losses. Cash on hand is expected to drop continuously, but most of the incurred expenditures related to construction will be for project development, which will be capitalized as real estate properties under development (non-current asset) on our balance sheet. For more information on risks in our business, please refer to the Risk Factors section of our 2017 Annual Report on Form 20-F as filed with the SEC and on our website.

According to our project development plan, project investment for the second quarter of 2018 is estimated to be $37.8 million, and project investment for the year of 2018 is estimated to be $153.5 million.

The information contained in or that can be accessed through the website mentioned in this announcement does not form part of this announcement.

PAYMENT OF QUARTERLY DIVIDENDS FOR 2018
As announced on October 30, 2017, the Company set the payment schedule of quarterly dividends for 2018. The dividend for the first quarter of 2018 was paid on April 20, 2018.

The following table updates the previously announced schedule for declaration and payment of quarterly dividends in 2018.

Payment


Record Date


Payment Date


Dividend

(per share)



Status

Q1 2018


December 31, 2017


January 19, 2018


$

0.07



Paid

Q2 2018


March 31, 2018


April 20, 2018


$

0.07



Paid

Q3 2018


June 30, 2018


July 20, 2018


$

0.07




Q4 2018


September 30, 2018


October 19, 2018


$

0.07




Full Year 2018






$

0.28




The Company's decision to continue making dividend payments in 2018 as set out and confirmed in the above table does not necessarily mean that cash dividend payments will continue thereafter or at the same amount. Whether future dividends after 2018 are to be declared will depend upon Company's future growth and earnings at each relevant period, of which there can be no assurance, and the Company's cash flow needs for business operations and transformation. Accordingly, there can be no assurance that cash dividends on the Company's common shares will be declared beyond those declared for 2018, and we also cannot assure you what the amounts of such dividends will be or whether such dividends, once declared for a specific period, will continue for any future period, or at all.

PROPOSED SCHEDULE FOR RELEASE OF QUARTERLY FINANCIAL RESULTS FOR 2018

To maintain the efficiency of delivering the Company's quarterly financial results to the market, the Company's management has decided to follow approximately the same schedule of 2017 to release the quarterly financial results for 2018. Details of the expected quarterly release dates are as follows:

Announcements of Financial Results

Quarter


Date of release

Q1 2018


April 30, 2018 (Monday)

Q2 2018


July 30, 2018 (Monday)

Q3 2018


November 5, 2018 (Monday)

Q4 2018


January 28, 2019 (Monday)

FORWARD-LOOKING STATEMENTS AND FACTORS THAT COULD CAUSE OUR SHARE PRICE TO DECLINE

Certain statements included in this press release, other than statements of historical fact, are forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "plan", "seek", "believe" or "timetable". These forward-looking statements, which are subject to risks, uncertainties, and assumptions, may include projections of our future financial performance based on our growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations about future events. There are important factors that could cause our actual results, level of activity, performance, or achievements to differ materially from the results, level of activities, performance, or achievements expressed or implied by the forward-looking statements, including, but not limited to, delay in the Company's ability to obtain all requisite permits and approvals from relevant government authorities in relation to the redevelopment of two parcels of properties in Guangming, Shenzhen, and Gushu, Shenzhen, respectively, and the successful redevelopment of the two parcels of properties into Nam Tai Inno Park and Nam Tai Inno City; the sufficiency of the Company's cash position and other sources of liquidity to fund its property developments; continued inflation and appreciation of the Renminbi against the US dollar; rising labor costs in China and changes in the labor supply and labor relations. In particular, you should consider the risks outlined under the heading "Risk Factors" in our most recent Annual Report on Form 20-F and in our Current Report filed on Form 6-K from time to time. The Company's decision to continue dividend payments in 2018 does not necessarily mean that dividend payments will continue thereafter. Whether future dividends will be declared depends upon the Company's future growth and earnings, of which there can be no assurance, as well as the Company's cash flow needs for further expansion. Accordingly, there can be no assurance that cash dividends on the Company's common shares will be declared beyond those declared for 2018, what amount those dividends may be or whether such dividends, once declared for a specific period, will continue for any future period, or at all; and whether we will purchase any of our shares in the open markets or otherwise. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance, or achievements. You should not rely upon forward-looking statements as predictions of future events. These forward-looking statements apply only as of the date of this press release; as such, they should not be unduly relied upon as circumstances change. Except as required by law, we are not obligated, and we undertake no obligation, to release publicly any revisions to these forward-looking statements that might reflect events or circumstance occurring after the date of this release or those that might reflect the occurrence of unanticipated events.  

ABOUT NAM TAI PROPERTY INC.

We are a real estate developer. We hold two parcels of land located in Guangming and Gushu, Shenzhen, China. We are converting these two parcels of land that formerly housed the manufacturing facilities of our prior businesses into high-tech research and development centers, Nam Tai Inno Park and Nam Tai Inno City. We expect our principal income in the future will be derived from rental income from these research and development centers. Nam Tai Property Inc. is a corporation registered in the British Virgin Islands and listed on the New York Stock Exchange (Symbol: "NTP").

Please refer to the Nam Tai website (www.namtai.com) or the SEC website (www.sec.gov) for Nam Tai press releases and financial statements.

NAM TAI PROPERTY INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

FOR THE PERIODS ENDED MARCH 31, 2018 AND 2017

(In Thousands of US dollars except share and per share data) 






Three months ended March 31,



2018

 



2017

 

Operation income (1)


$

--



$

594

Net operation income



--




594

Costs and expenses








General and administrative expenses



9,116




1,984




9,116




1,984

Operating loss



(9,116)




(1,390)

Other income, net (2)



3,449




728

Interest income



1,507




2,476

Gain on disposal of property



6,763




Write off of demolished building



(35)




Income before income tax



2,568




1,814

Consolidated net income


$

2,568



$

1,814

Functional currency translation adjustment



6,038




540

Other comprehensive income(3)



6,038




540

Consolidated comprehensive income (4)


$

8,606



$

2,354

Income earnings per share








Basic


$

0.07



$

0.05

Diluted


$

0.07



$

0.05

Weighted average number of shares ('000)








Basic



37,669




36,466

Diluted



38,527




36,990









Notes:








(1) The property at Phase II in Gushu has been rented to a third party lessee with a term of three and a half years ending in October
2017.

(2) Other incomes, net, include an exchange gain of $3.3 million for the three months ended March 31, 2018.

(3) An increase in other comprehensive income due to foreign exchange translation.

(4) Consolidated net income for the three months ended March 31, 2018 mainly include gain of $6.8 million on disposal of an office
property in Hong Kong,
exchange gain of $3.3 million as a result of the appreciation of Renminbi against the US dollar in the first
quarter of 2018 and interest income of $1.5 million earned from time deposits; but partly offset by general and administrative
expenses of $
9.1million which mainly included accrual of compensation for loss of office of $3.7 million for the anticipated retirement
of
a senior manager and option expenses of $1.4 million for certain new officers and employees, salary & benefits of $1.8 million,
depreciation of $1.0 million
and audit, legal & professional fees of $0.6 million.

 

NAM TAI PROPERTY INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

AS AT MARCH 31, 2018 AND DECEMBER 31, 2017

(In Thousands of US dollars) 

















March 31,

2018



December 31,

2017




(Unaudited)



(Audited)


ASSETS









Current assets:









Cash and cash equivalents(1)


$

169,892



$

165,173


Short term investments(1)



3,344




--


Prepaid expenses and other receivables



5,487




5,100


Total current assets



178,723




170,273


Long term investments



2,408




2,319


Real estate properties under development, net(2)



56,193




52,460


Property, plant and equipment, net



34,940




36,976


Other assets



--




49


Total assets


$

272,264



$

262,077


LIABILITIES AND SHAREHOLDERS' EQUITY









Current liabilities:









Accounts payable


$

3,189



$

5,705


Accrued expenses and other payables



5,211




1,500


Dividend payable



7,933




10,514


Total current liabilities



16,333




17,719


EQUITY









Shareholders' equity:









Common shares



377




376


Additional paid-in capital



252,869




249,856


Retained earnings



2,497




(24)


Accumulated other comprehensive income (loss)(3)



188




(5,850)


Total shareholders' equity



255,931




244,358


Total liabilities and shareholders' equity


$

272,264



$

262,077











Note:


















(1)         According to the definition of "Balance Sheet" under the Financial Accounting Standard Board ("FASB") Accounting Standards
Codification ("ASC") 210-10-20, cash equivalents are short-term, highly liquid investments that are readily convertible to cash. Only
investments with original maturities of three months or less when purchased qualify under that definition. Therefore, the fixed deposits
maturing over three months in amount of $
3.3 million and nil as at March 31, 2018 and December 31, 2017, respectively, are not
classified as cash and cash equivalents but are separately disclosed as short
-term investments in the balance sheet.

(2)         Capitalization on project investment was $2.0 million for the first quarter of 2018, our accumulated project investment was $56.2 million
up to March 31, 2018.

(3)         Accumulated other comprehensive income (loss) represented foreign currency translation adjustment.

 

NAM TAI PROPERTY INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

FOR THE PERIODS ENDED MARCH 31, 2018 AND 2017

(In Thousands of US dollars)









Three months ended March 31,



2018



2017

CASH FLOWS FROM OPERATING ACTIVITIES








Consolidated net income


$

2,568



$

1,814

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








Depreciation and amortization of property, plant and equipment,

   land use rights and other assets



1,015




76

Gain on disposal of property, plant and equipment



(6,956)




(19)

Write off demolished building



35




--

Share-based compensation expenses



1,366




240

Unrealized exchange gain



(3,124)




(221)

Changes in current assets and liabilities:








Increase in prepaid expenses and other receivables



(302)




(242)

Increase in accrued expenses and other payables



3,585




276

Total adjustments



(4,381)




110

Net cash (used in) provided by operating activities


$

(1,813)



$

1,924

CASH FLOWS FROM INVESTING ACTIVITIES








Payments for real estate properties under development


$

(4,329)



$

(1,405)

Purchase of property, plant & equipment



(501)




(116)

Decrease in deposits for real estate properties under

development



19




20

Increase in deposits for purchase of property, plant and equipment



(61)




(217)

Proceeds from disposal of property, plant and equipment



9,706




19

Proceeds from disposal of demolished building



197




Proceeds from disposal of other asset



50




Increase in short term investments



(3,344)




(19,891)

Net cash provided by (used in) investing activities


$

1,737



$

(21,590)

CASH FLOWS FROM FINANCING ACTIVITIES








Cash dividends paid


$

(2,629)



$

(2,551)

Proceeds from shares issued for option exercise



1,384




403

Net cash used in financing activities


$

(1,245)



$

(2,148)

Net decrease in cash and cash equivalents


$

(1,321)



$

(21,814)

Cash and cash equivalents at beginning of period



165,173




94,558

Effect of exchange rate changes on cash and cash equivalents and short

   term investments



6,040




440

Cash and cash equivalents at end of period


$

169,892



$

73,184

 

NAM TAI PROPERTY INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIODS ENDED MARCH 31, 2018 AND 2017 

(In Thousands of US dollars)




1. These financial statements, including the consolidated balance sheet as of December 31, 2017, which was derived from audited financial
statements, do not include all of the information and notes required by U.S. Generally Accepted Accounting Principles for complete
financial statements and should be read in conjunction with the consolidated financial statements and accompanying notes included in the
Company's annual report on Form 20-F for the fiscal year ended December 31, 2017.

2. In the opinion of management, all adjustments (consisting of normal, recurring adjustments) considered necessary for a fair presentation
have been included. Operating results for the interim periods presented are not necessarily indicative of the results that may be expected
for the full year ended December 31, 2017.

3. Accumulated other comprehensive income (loss) represents foreign currency translation adjustments. The consolidated comprehensive
income was $8,606 and $2,354 for the three months ended March 31, 2018 and 2017.

4. A summary of the operation income, other income, net, net income and long-lived assets by geographical areas is as follows:






Three months ended March 31,



2018



2017

OPERATION INCOME WITHIN:








-PRC, excluding Hong Kong


$

--



$

594

OTHER INCOME, NET:








- Gain on exchange difference


$

3,254



$

847

- Loss from Wuxi operations



--




(166)

- Others



195




47

Total other income, net


$

3,449



$

728

NET INCOME FROM OPERATIONS WITHIN:








- PRC, excluding Hong Kong


$

(1,881)



$

(328)

- Hong Kong



4,449




2,142

Total net income


$

2,568



$

1,814











March 31, 2018  



December 31, 2017

LONG-LIVED ASSETS WITHIN:








- Real estate properties under development in PRC, excluding

 Hong Kong


$

56,193



$

56,460

- Property, plant and equipment in PRC, excluding Hong Kong



34,865




33,894

- Hong Kong



75




3,082

Total long-lived assets


$

91,133



$

89,436

 

 

Cision View original content:http://www.prnewswire.com/news-releases/nam-tai-property-inc-reports-q1-2018-results-300638747.html

SOURCE Nam Tai Property Inc.

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