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           outstanding		10		10
Common stock, par value $0.00001, 100,000,000 authorized, 29,452,669 and           29,100,503 issued and outstanding at March 31, 2015 and December 31, 2014		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

 

 

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SOURCE China United Insurance Service, Inc.

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