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KGJI OTCM· Kingold Jewelry Inc.
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KGJI OTCM· Kingold Jewelry Inc.
Earnings report Q3 2019

Kingold Jewelry Inc. Reports Significant Decrease in Revenue for Latest Quarter

Segments of revenue

Kingold Jewelry Inc. reported net sales of approximately $382.8 million for the three months ended September 30, 2019. This represents a significant decrease of approximately $243.4 million, or 38.9%, compared to the same period in 2018. The decrease in revenue was primarily due to a decrease in sales volume, with total sales quantity decreasing by 15.9 metric tons or 53.6%.

Strengths

Despite the decrease in revenue, Kingold Jewelry Inc. has maintained a gross profit of approximately $15.2 million for the latest quarter. This demonstrates the company's ability to effectively manage its cost of sales and maintain profitability in a challenging market environment. Additionally, the company's management has attributed the decrease in sales volume to customers' perception of the investment in gold, which suggests that the decrease may be temporary and could potentially reverse in the future.

Challenges

The significant decrease in revenue for the latest quarter poses a challenge for Kingold Jewelry Inc. The decrease in sales volume, influenced by customers' perception of the investment in gold, indicates a decline in market demand for the company's products. This highlights the need for the company to adapt its sales and marketing strategies to address changing customer preferences and market conditions.

Noteworthy

It is noteworthy that Kingold Jewelry Inc. experienced a decrease in revenue for both the nine months ended September 30, 2019, and the three months ended September 30, 2019. The decrease in revenue for the nine-month period amounted to approximately $410.1 million, or 22.2%, compared to the same period in 2018. This indicates a sustained decline in sales volume and market demand for the company's products.

Summary

Kingold Jewelry Inc. faced significant challenges in the latest quarter, with a substantial decrease in revenue primarily driven by a decline in sales volume. However, the company has demonstrated strength in maintaining a gross profit and managing its cost of sales. The decrease in sales volume is attributed to customers' perception of the investment in gold, suggesting a potential for improvement in the future. Kingold Jewelry Inc. should focus on addressing changing customer preferences and market conditions to overcome the challenges and drive revenue growth in the coming quarters.

Source documents

Form 10-Q  filed on Nov 12, 2019
81 pages scanned

Reference data

Company financials Q3 revenue 383M
Analyst estimates Q3 EPS missed by NaN%
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