For the 2Q 2016, Orient Paper's revenue decreased by $3.3 million, or 8%, to $38 million from $41.3 million for the same period of the last year, mainly due to the decrease in sales of regular CMP which was partially offset by increase in sales of tissue paper products and digital photo paper.
Gross profit decreased by 34.3% to $6.9 million and gross margin decreased by 7.3 percentage points to 18.1% for the 2Q 2016, mainly due to decrease in sales volume for CMP and decrease in average selling prices ("ASPs") across all products.
Net income was $2.6 million, or $0.12 per basic and diluted share, for the 2Q 2016, as compared to net income of $5.6 million, or $0.28 per basic and diluted share, for the same period of last year.
EBITDA decreased by $3.3 million, or 29.2%, to $8 million for the 2Q 2016, from $11.3 million for the same period of last year.
Mr. Zhenyong Liu, Chairman and CEO of Orient Paper, commented, "The overall business environment remained challenging for the paper industry in China during the 2Q 2016, as China's economy continued to slow down and the RMB further depreciated against the U.S. dollar. In this quarter, we saw an 8% year-over-year decrease in our total revenues. Despite the decrease in our total revenues, our tissue paper products have continued to experience strong sales growth since their commercial production launch in June 2015, and generated revenue of $1.5 million in the 2Q 2016. Looking ahead, the macroeconomic environment and the state of the paper industry in China will continue to have significant impact on our financial performance. We expect that our tissue paper product segment will continue to experience strong growth."
Orient Paper, Inc. is a leading paper manufacturer in North China. Using recycled paper as its primary raw material (with the exception of its digital photo paper and tissue paper products), Orient Paper produces and distributes three categories of paper products: corrugating medium paper, offset printing paper, and other paper products, including digital photo paper and tissue paper products.