China United Insurance Service Reports 2014 First Quarter Financial Results

ZHENGZHOU, China and TAIPEI, Taiwan, May 19, 2014 /PRNewswire/ -- China United Insurance Service, Inc. (CUIS) (OTCBB: CUII), a leading insurance intermediary company with operations in the People's Republic of China and Taiwan, today reported financial results for the first quarter ended March 31, 2014.

The geographical distribution of CUIS' revenues for the three months ended March 31, 2014 and 2013 were as follows:

		Three months ended March 31
Geographical Area		2014		2013
PRC		$         715,197		$           568,378
Taiwan		8,146,526		11,377,128
		$      8,861,723		$      11,945,506

Revenues for the quarter ended March 31, 2014 were $8.9 million, compared with $11.9 million in the same period last year. Revenues for the prior year period included $2.4 million of persistency awards from the Taiwan operation, granted from two principal insurance companies in which CUIS acts as their agent. No such awards were paid during the 2014 first quarter, although approximately $700,000 in grants was received in April 2014, with additional grants anticipated. The company said that due to new regulations, grants received in 2014 will be amortized over the course of the year. 

Gross profit for the quarter was $3.5 million versus $4.1 million for the comparable quarter in 2013. Operating expense for the 2014 first quarter was $2.7 million, compared with $2.8 million in the same quarter a year ago.

Net income for quarter ended March 31, 2014 was $650,000, compared with $1.2 million in the same quarter last year. Net income attributable to CUIS' shareholders for the quarter was $255,000, or $0.01 per diluted share, versus net income of $692,000, or $0.02 per diluted share, in the same period 2013.

On January 17, 2014, the board of directors approved a change in the company's fiscal year to December 31 from June 30. 

"Our operations in China are beginning to gain traction, with a 25.8% increase in revenues for the first quarter, compared with the prior year period," said Chung-Mei Lo, Chief Executive Officer. "We continue to pursue strategic partnerships with leading insurance companies to expand our product offerings to customers. 

"As we move forward, our focus will remain on providing unparalleled customer service through highly trained professionals. As well, our nationwide license in China gives us a strong competitive advantage in addressing the large and growing marketplace for insurance coverage," Lo said.

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. In 2012, the company consolidated both Taiwan and China's operations. CUIS has assembled an experienced executive team, with more than 81 well-experienced managers in agency management to guide its more than 4,200 knowledgeable and professional agents. By offering innovative products, continuously improving the management system and selecting the best products to meet clients' needs, CUIS aspires to become one of 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, 2014 AND 2013
(Unaudited)
				Three Months Ended March 31,
				2014		2013
Revenues			$	8,861,723	$	11,945,506
Cost of revenue				5,368,225		7,780,332
Gross profit				3,493,498		4,165,174
Operating expenses:
	Selling			302,989		271,030
	General and administrative			2,413,245		2,592,790
Total operating expenses				2,716,234		2,863,820
Income from operations				777,264		1,301,354
Other income (expenses):
	Interest income			43,584		25,186
	Other - net			72,944		142,093
Total other income (expenses)				116,528		167,279
Income before income taxes				893,792		1,468,633
Income tax expense				243,600		302,594
Net income				650,192		1,166,039
Net income attributable to the noncontrolling interests				(394,794)		(474,234)
Net income attributable to parent's shareholders				255,398		691,805
Other comprehensive items
Foreign currency translation gain (loss)				(97010)		(24,258)
Other comprehensive income(loss)				-		-
Attributable to  parent's shareholders				(97,010)		(24,258)
Other comprehensive items
attributable to noncontrolling interest				80,402		40,797
Comprehensive income attributable to
parent's shareholders			$	158,388	$	667,547
Comprehensive income attributable to
noncontrolling interest			$	(314,392)	$	(433,437)
Weighted average shares outstanding:
	Basic and diluted			29,100,503		29,100,503
Income per share:
	Basic and diluted		$	0.01	$	0.02

 

CHINA UNITED INSURANCE SERVICE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 2014 AND DECEMBER 31, 2013
(Unaudited)
				March 31, 2014		December 31, 2013
				(UNAUDITED)		(AUDITED)
ASSETS
	Current assets
		Cash and equivalents	$	18,151,702	$	18,070,093
		Marketable securities		2,528,719		2,563,685
		Accounts receivable, net		3,583,525		7,282,183
		Other current assets		2,640,889		2,329,677
	Total current assets			26,904,835		30,245,638
	Property, plant and equipment, net			1,156,071		1,041,189
	Intangible assets			283,785		308,267
	Long-term Investment			100,846		102,295
	Other assets			599,776		587,303
TOTAL ASSETS			$	29,045,313	$	32,284,692
LIABILITIES AND STOCKHOLDERS' EQUITY
	Current liabilities
		Taxes payable	$	727,064	$	498,441
		Unearned revenue		1,563,572		1,586,038
		Other current liabilities		5,555,359		8,632,305
		Due to related parties		154,203		154,798
TOTAL CURRENT LIABILITIES				8,000,198		10,871,582
		Long-term liabilities		6,254,287		7,095,062
TOTAL LIABILITIES				14,254,485		17,966,644
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
		Preferred stock, par value $0.00001, 10,000,000 authorized, 1,000,000 issued and outstanding		10		10
		Common stock, par value $0.00001, 100,000,000 authorized, 29,100,503 issued and outstanding		291		291
		Additional paid-in capital		4,674,593		4,674,593
		Reserves		491,678		415,041
		Accumulated other comprehensive loss		(172,898)		(75,888)
		Retained earnings		3,777,144		3,598,383
		Stockholder's equity attribute to parent's shareholders		8,770,818		8,612,430
		Noncontrolling interest		6,020,010		5,705,618
TOTAL STOCKHOLDERS' EQUITY				14,790,828		14,318,048
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY			$	29,045,313	$	32,284,692

 

SOURCE China United Insurance Service, Inc.

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