HARBIN, China, April 2, 2020 /PRNewswire/ -- China XD Plastics
Company Limited (NASDAQ: CXDC) ("China XD Plastics" or the
"Company"), one of China's leading
specialty chemical companies engaged in the development,
manufacture and sale of polymer composite materials primarily for
automotive applications, today provided an update on the impact of
the coronavirus outbreak on its business and operations.
While the Company's business operations and financial results
for the year ended December 31, 2019
were not affected by this global pandemic, the Company had
temporarily closed its manufacturing factories and corporate
offices from January 24th to February 9th,
2020, as a result of the Outbreak and widespread public
concerns. All company personnel had been required to stay at home
until February 9th by the government
based on the development of this health epidemic. The preparation
of Company's financial statements and audit process have been
delayed due to government-imposed quarantines, office closings and
travel restrictions on Company's personnel and service providers,
including auditors. In the short term, the Company expects the
outbreak to have a material impact on its operations in the first
quarter of 2020. The overall impact of the Coronavirus on the
Company's operations and financial results for 2020 remains to be
seen. Presently, the pandemic in China has been well contained. As of the date
of this press release, approximately 50% of employees of the
Company's administrative offices return to work. Our factories in
Heilongjiang and Sichuan provinces were running at 20% capacity
utilization at the end of this March and are expected to reach 70%
capacity utilization by the end of this April and normal
utilization rate by the end of this May. Our factory in
Dubai was not impacted by the
coronavirus outbreak during January and February but only 20%
employees from private sectors are now allowed to go to work due to
the recent rise of coronavirus cases in UAE.
On March 4, 2020, in a public
statement, Securities and Exchange Commission (SEC) Chairman
Jay Clayton stated "The health and
safety of all participants in our markets is of paramount
importance. While timely public filing of Exchange Act reports is a
cornerstone of well-functioning markets, we recognize that this
situation may prevent certain issuers from compiling these reports
within required timeframes." To address potential compliance
issues, the Commission has issued an order that, subject to certain
conditions, provides publicly traded companies with an additional
45 days to file certain disclosure reports that would otherwise
have been due between March 1 and April 30,
2020. Among other conditions, companies must convey through
a current report a summary of why the relief is needed in their
particular circumstances. The Commission may extend the time period
for the relief, with any additional conditions it deems
appropriate, or provide additional relief as circumstances
warrant.
The Company is working to file its annual report for fiscal year
ended December 31, 2019 prior to the
above referenced extended deadline. Chairman and CEO, Mr.
Jie Han, stated, "We are continuing
to work closely with our provincial government to take all
necessary precautions during this outbreak until such time as
conditions to fully resume operations are suitable. As always, our
top priority is the safety and security of our employees,
customers, and their families. We expect to provide further updates
as we evaluate any impact of the coronavirus outbreak on our
operations in the coming weeks."
About China XD Plastics Company Limited
China XD Plastics Company Limited, through its wholly-owned
subsidiaries, develops, manufactures and sells polymer composites
materials, primarily for automotive applications. The Company's
products are used in the exterior and interior trim and in the
functional components of 31 automobile brands manufactured in
China, including without
limitation, Audi, Mercedes Benz,
BMW, Toyota, Buick, Chevrolet, Mazda, Volvo, Ford, Citroen, Jinbei
and VW Passat, Golf, Jetta, etc. The Company's wholly-owned
research center is dedicated to the research and development of
polymer composites materials and benefits from its cooperation with
well-known scientists from prestigious universities in China. As of September
30, 2019, 601 of the Company's products have been certified
for use by one or more of the automobile manufacturers in
China. For more information,
please visit the Company's English website at
http://chinaxd.irpass.com/, and the Chinese website at
http://www.xdholding.com.
Safe Harbor Statement
This announcement contains forward-looking statements within the
meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. All statements other than statements
of historical fact in this announcement are forward-looking
statements, including but not limited to, the Company's growth
potential in international markets; the effectiveness and
profitability of the Company's product diversification strategy;
the impact of the Company's product mix shift to more advanced
products and related pricing policies; the effectiveness,
profitability, and the marketability of its the ongoing mix shift
to more advanced products; the prospect of the Company's
Dubai facility, and the associated
expansion into Middle East,
Europe and other parts of
Asia; the prospect of the
Company's Southwest China
facility, the prospects of the Company's Harbin facility, and its penetration into
Northeast China; and its
penetration into Southwest China;
the Company's projections of its revenues for performance in fiscal
2019. These forward-looking statements can be
identified by terminology such as "will," "expect," "project,"
"anticipate," "forecast," "plan," "believe," "estimate" and similar
statements. Forward-looking statements involve inherent risks and
uncertainties and are based on current expectations, assumptions,
estimates and projections about the Company and the industry. A
number of important factors could cause actual results to differ
materially from those contained in any forward-looking statement.
Potential risks and uncertainties include, but are not limited to,
the global economic uncertainty could further impair the automotive
industry and limit demand for our products; fluctuations in
automotive sales and production could have a material adverse
effect on our results of operations and liquidity; our financial
performance may be affected by the prospect of our Dubai facility and the associated expansion
into Middle East, Europe and other parts of Asia; the withdrawal of preferential
government policies and the tightening control over the Chinese
automotive industry and automobile purchase restrictions imposed in
certain major cities may limit market demand for our products; the
slowing of Chinese automotive industry's growth; the concentration
of our distributors, customers and suppliers; and other risks
detailed in the Company's filings with the Securities and Exchange
Commission and available on its website at http://www.sec.gov. The
Company undertakes no obligation to update forward-looking
statements to reflect subsequent occurring events or circumstances,
or to changes in its expectations, except as may be required by
law. Although the Company believes that the expectations
expressed in these forward looking statements are reasonable, it
cannot assure you that its expectations will turn out to be
correct, and investors are cautioned that actual results may differ
materially from the anticipated results.
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SOURCE China XD Plastics Company Limited