Vaping Brand Smiss Reported a Loss of RMB 8.74 Million in the First Half of 2016

According to Wabei News on September 12, Smiss (stock code: 833116) recently released its 2016 semi-annual report. During the reporting period, the company recorded revenue of RMB 29.0996 million, up 2.18% year-on-year; net profit attributable to shareholders of the listed company was -RMB 8.7396 million, compared with -RMB 2.6262 million in the same period last year, reflecting a wider loss; basic earnings per share were -RMB 0.16, versus -RMB 0.05 in the same period last year.

As of June 30, 2016, Smiss had total assets of RMB 73.1148 million, down 6.92% from the beginning of the period. Its debt-to-asset ratio was 31.37%, up 6.38 percentage points from 24.99% at the beginning of the period. Net cash flow from operating activities for the current period was -RMB 13.4296 million, compared with -RMB 3.1935 million in the same period last year.

During the reporting period, Smiss recorded operating revenue of RMB 29.0996 million, an increase of 2.18% over the same period last year, mainly due to newly added revenue from China Tobacco customers.

During the reporting period, Smiss posted net profit of -RMB 8.7396 million, compared with -RMB 2.6262 million in the same period last year, with losses increasing. There were two main reasons: First, in line with its long-term strategic plan, Smiss's wholly owned subsidiary, Dongguan Beika Electronic Technology Co., Ltd., fully launched production and operations in March 2016, and its production capacity was sufficient to meet current order demand. As a result, Smiss shut down the production department of its wholly owned subsidiary in Guangming New District, Shenzhen, Shenzhen Anyile Biotechnology Co., Ltd. In accordance with labor law, Smiss properly arranged placement for more than 300 employees, incurring more than RMB 3 million in related expenses. Second, the office renovation at the company's headquarters on Wutong Island in Xixiang, along with relocation expenses for both locations, increased operating costs.

According to information from the Wabei New Third Board Research Institute, Smiss operates in the healthcare products segment. Its main business is the R&D, production, and sales of e-cigarette products, e-cigarette components, and related supporting products.