Sorl Auto Parts, Inc. (NASDAQ:SORL) Reports A 37.4% Q1 Sales Increase

Sorl Auto Parts, Inc. (NASDAQ:SORL)

Sorl Auto Parts, Inc. (NASDAQ:SORL)

Sorl Auto Parts, Inc. (NASDAQ:SORL) is off to a positive 2017 start with a 37.4% increase in quarterly net sales. The company reported $73.9 million in net sales for Q1 2017 compared to $53.8 million that was reported in Q1 2016. Generally, the company reported a significant increase in its sales for Q1 2017. Revenue from the company’s domestic OEM customers amounted to $41.8 million in Q1 2017. This translates to 48.8% improvement from the $28.1 million reported in Q1 2016. The increase resulted from an increase in truck sales in Q12017. There was 22.9% improvement in sales from commercial vehicles, 30.9% increase in sales from trucks and a whopping 93.0% increase in sales from heavy-duty vehicles.

There was impressive improvement in aftermarket sales from the Chinese market with the company reporting $18.1 million in sales which translates to 37.1% increase from the $13.2 million reported in Q1 2016. Sorl Auto Parts, Inc. (NASDAQ:SORL) aftermarket sales benefited from sale of new vehicles in China as well as the expiry of the OEM warranties. The company saw a 12% improvement in its international revenue to close the quarter at $14 million up from the $12.5 million reported in Q1 2016. The growth is a product of the company’s efforts to grow its customer base in a number of international markets.

In Q1 2017, Sorl Auto Parts, Inc. (NASDAQ:SORL) reported a 42.4% increase in its quarterly gross profits to $20.5 million as compared to $14.4 million that the company reported in Q12016. There was a slight improvement in gross margin to 27.8% from the 26.8% that was reported in Q12016.

During the quarter, Sorl Auto Parts, Inc. (NASDAQ:SORL) reported $11.7 million in operating expenses compared to $14.2 that was reported in Q1 2016. It is this drop in operating expenses that led to a 41.6% decreased in general and administrative expenses. Total operation expenses represent 15.8% of the company’s total revenue reported in Q1 2017. In Q1 2016, total operating expenses amounted to 26.4% of the total revenue reported in the quarter.

Sales and distribution activities led to expenses amounting to $5.6 million which is about the same as what was reported in Q1 2016. Expenses from sales and distribution activities represents 7.6% of the total revenue for the quarter. In Q1 2016, similar expenses accounted for 10.3% of the total revenue reported in the quarter.

General and administrative expenses during the quarter amounted to $4 million which amounts to 5.5% of the total revenue in the quarter. Sorl Auto Parts, Inc. (NASDAQ:SORL) reported $6.9 million or 12.9% of the total revenue in Q1 2016.

In the Friday session, Sorl Auto Parts, Inc. (NASDAQ:SORL) dropped $0.55 or 5.93% to close the session at $8.72 with a market cap of $179.57M.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

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About the author: James Marion is a University of Houston student studying Business with a concentration in Finance.

Author: James Marion

James Marion is a University of Houston student studying Business with a concentration in Finance. James has interned with several investment professionals and hopes to pursue a career as a professional stock analyst after graduation.

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