<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of November, 1999
Qiao Xing Universal Telephone, Inc.
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(Translation of registrant's name into English)
Qiao Xing Building, Wu Shi Industrial Zone
Huizhou City, Guangdong, People's Republic of China
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(Address of principal executive offices)
[Indicate by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
----- -----
[Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the information to
the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes No X
----- -----
[If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82- .
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Qiao Xing Universal Telephone, Inc.
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(Registrant)
Date: November 10, 1999 By: /s/ Rui Lin Wu
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Rui Lin Wu, Chairman
<PAGE>
Mr. Jeff J.F. Feng Ruth Shaer/Eugene Heller
Assistant to Chairman Silverman Heller Associates
Qiao Xing Universal Telephone, Inc. 1100 Glendon Avenue, PH-1
Huizhou, Guangdong, P.R.C. Los Angeles, CA 90024-5305
http:\\www.qiaoxing.com Tel: (310) 208-2550
E-mail: [email protected] Fax: (310) 208-0931
------------------------
Tel: (011) 86-752-2808-188 E-mail: [email protected]
Fax: (011) 86-752-2803-101
QIAO XING UNIVERSAL TELEPHONE ANNOUNCES INTERIM
UNAUDITED RESULTS FOR THE
SIX MONTHS ENDED JUNE 30, 1999
- Company ranked second in sales in the People's Republic of China in 1997 and
1998 -
GUANGDONG, CHINA (November 10, 1999) -- Qiao Xing Universal Telephone, Inc.
(NASDAQ NMS: XING) today announced interim unaudited reports for the six-month
period ended June 30, 1999.
Net sales for the six months ended June 30, 1999 were $21.6 million compared to
$25.7 million during the same period in 1998. The decrease was attributable to a
transition from producing low margin corded phones to higher margin units,
coupled with decreased sales efforts on traditional cordless phones as the
Company began to shift production to digital cordless phones.
Gross profit for the six months ended June 30, 1999 was $8.3 million compared to
$ 8.1 million for the same period in 1998. Margins increased to 38.2%, up from
31.4% in the year ago period. The increased margins were the result of the
change in the Company's product mix to higher margin products. During the six
months ended June 30, 1999, traditional corded phones represented approximately
46% of sales, compared to approximately 55% of sales for the same period in
1998. Special function phones, with relatively higher gross profit margins,
represented approximately 37% of sales for the six months ended June 30, 1999,
compared to approximately 21% of sales for the same period in 1998.
According to reports released by the Chinese Trade and Foreign Economy
Statistics Bureau, Qiao Xing Telephones ranked second in sales in the People's
Republic of China (PRC) in 1997 and 1998.
Commented Qiao Xing Universal Telephone, Inc. chairman Mr. Rui Lin Wu: "We plan
to continue our leadership role in China's burgeoning communications market by
focusing on R&D to introduce new products and eliminate unprofitable ones. Qiao
Xing employs 83 personnel in the R&D and engineering divisions who work side by
side with our sales and marketing executives to gauge market demand in
developing new products. Currently, the R&D division is developing 34 models of
corded phones and four models of cordless phones. Our plan is to continue to
invest in research and development and to increase our manufacturing capacity
with the long-term objective of becoming the largest telephone manufacturer in
China."
- more -
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Qiao Xing Universal Telephone, Inc.
Page Two
Added Mr. Wu: "We have also completed the development of our digital cordless
phone, which is expected to enter production in November 1999. We are applying
for tax exemptions for this product."
Net income for the six months ended June 30, 1999 was $2.7 million compared to
net income of $3.9 million for the same period in 1998. This was attributable to
the increased income tax rate during the six months ended June 30, 1999, as well
as increased operating expenses as the Company added technology experts and
professional managers to strengthen its R&D and management capabilities.
Following the Company's completion of a public offering of 1,600,000 shares of
common stock on February 17, 1999, for the six months ended June 30, 1999, fully
diluted per share earnings were $0.30 on 9,176,000 weighted average shares
outstanding, compared to $ 0.49 on 7,873,000 weighted average shares outstanding
reported in the comparable period last year
Income taxes and provisions for the six months ended June 30, 1999 was $1.1
million compared to $628,000 for the same period in 1998. The increase was
principally due to a subsidiary that was previously entitled to 50% exemption
from People's Republic of China (PRC) enterprise income taxes, but which started
paying income tax at a rate of 24% during the 1999 calendar year.
During the period, the Company strengthened its distribution network for the
Mainland China market and currently has 52 sales offices, compared to 38 offices
during the same period in 1998. The Company also expanded outlets and
consignments in department stores.
In August 1995, Qiao Xing became the first telephone manufacturer in China to be
awarded the ISO 9001 Quality System Accreditation. The Company currently
produces 165 corded models and 25 cordless models and has an extensive
nationwide sales network that comprises over 1,000 retail outlets in PRC.
This press release contains "forward-looking statements" regarding future
revenues and operating information and their impact on future results. Such
forward-looking information involves important risks and uncertainties that
could significantly affect anticipated results in the future and, accordingly,
actual results may differ materially from those expressed in any forward-looking
statements made by or on behalf of the Company. These risks and uncertainties
include, but are not limited to, those relating to economic, political, legal
and social conditions in the People's Republic of China, dependence upon key
management personnel, competition, material factors relating to the operations
of the business, and domestic and global general economic conditions
[financial statements follow]
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Qiao Xing Universal Telephone, Inc.
Page Three
Qiao Xing Universal Telephone, Inc.
Consolidated Income Statement of operation
<TABLE>
<CAPTION>
Six months ended Six months ended
June 30, 1999 June 30, 1998
(Unaudited) (Unaudited)
US$'000 US$'000
------------------ -----------------
<S> <C> <C>
Sales,net 21,642 25,724
Cost of sales (13,382) (17,638)
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Gross profit 8,260 8,086
Selling expenses (1,056) (1,578)
Operating expenses (2,490) (1,113)
Interest expenses (591) (442)
Interest income 91 22
Other Income(expenses),net (19) (22)
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Income before tax 4,195 4,953
Provision for income tax (1,128) (628)
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Income before minority interests 3,067 4,325
Minority interests (335) (456)
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Net Income 2,732 3,869
================== =================
Weighted average number of
shares outstanding 9,176,000 7,873,000
================== =================
Earnings per common share 0.30 0.49
================== =================
</TABLE>
<TABLE>
<CAPTION>
Results of Operations
Six months ended
June 30
1999 1998
------------------------------ -------------------------------
US $'000 % US $'000 %
----------------- ------- ------------------ -------
<S> <C> <C> <C> <C>
Corded 10,017 46.29 14,111 54.86
Cordless 3,311 15.30 6,068 23.59
Smart card 4,446 20.54 5,080 19.75
Caller ID 2,889 13.35 196 0.76
Coin operated 328 1.52 269 1.05
Others 651 3.01
----------------- ------- ------------------ -------
Total 21,642 100 25,724 100
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</TABLE>
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