Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Mar. 15, 2014 | Jun. 30, 2013 | |
Document and Entity Information [Abstract] | ' | ' | ' |
Entity Registrant Name | 'Orient Paper Inc. | ' | ' |
Entity Central Index Key | '0001358190 | ' | ' |
Amendment Flag | 'false | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Filer Category | 'Smaller Reporting Company | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 18,753,900 | ' |
Entity Public Float | ' | ' | $20,185,416 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Current Assets | ' | ' |
Cash and cash equivalents | $3,131,163 | $13,140,288 |
Restricted cash | 2,454,108 | 1,585,138 |
Accounts receivable (net of allowance for doubtful accounts of $67,592 and $57,643 as of December 31, 2013 and 2012, respectively) | 3,327,494 | 2,836,335 |
Inventories | 11,428,405 | 15,104,101 |
Prepayments and other current assets | 1,068,031 | 5,401,705 |
Assets held for sale | 4,130,590 | ' |
Deferred tax assets - current | 413,537 | ' |
Total current assets | 25,953,328 | 38,067,567 |
Prepayment on property, plant and equipment | 1,492,098 | 1,445,645 |
Property, plant, and equipment, net | 178,535,259 | 122,391,456 |
Recoverable VAT | 3,277,188 | ' |
Deferred tax asset - non-current | 268,329 | 941,656 |
Total Assets | 209,526,202 | 162,846,324 |
Current Liabilities | ' | ' |
Short-term bank loans | 6,544,288 | 3,962,844 |
Current portion of long-term loan from credit union | 1,660,613 | 4,168,912 |
Current obligations under capital lease | 8,264,795 | ' |
Accounts payable | 926,571 | 1,012,906 |
Notes payable | 4,908,216 | 3,170,276 |
Security deposit from a related party | 1,636,072 | 1,075,606 |
Due to a related party | 64,546 | ' |
Accrued payroll and employee benefits | 498,010 | 292,638 |
Other payables and accrued liabilities | 2,651,472 | 1,262,284 |
Income taxes payable | 1,218,140 | 1,255,457 |
Total current liabilities | 28,372,723 | 16,200,923 |
Loan from credit union | 4,253,788 | 1,561,361 |
Loan from a related party | 2,389,633 | 2,315,239 |
Deferred gain on sale-leaseback | 1,160,271 | ' |
Long-term obligations under capital lease | 12,296,639 | ' |
Total liabilities | 48,473,054 | 20,077,523 |
Commitments and Contingencies | ' | ' |
Stockholders' Equity | ' | ' |
Common stock, 500,000,000 shares authorized, $0.001 par value per share, 18,753,900 and 18,459,775 shares issued and outstanding as of December 31, 2013 and 2012, respectively | 18,754 | 18,460 |
Additional paid-in capital | 46,909,543 | 46,135,975 |
Statutory earnings reserve | 6,038,406 | 5,963,960 |
Accumulated other comprehensive income | 17,146,308 | 12,327,439 |
Retained earnings | 90,940,137 | 78,322,967 |
Total stockholders' equity | 161,053,148 | 142,768,801 |
Total Liabilities and Stockholders' Equity | $209,526,202 | $162,846,324 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Balance Sheets [Abstract] | ' | ' |
Accounts receivable, allowance for doubtful accounts | $67,592 | $57,643 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares issued | 18,753,900 | 18,459,775 |
Common stock, shares outstanding | 18,753,900 | 18,459,775 |
Consolidated_Statements_of_Inc
Consolidated Statements of Income and Comprehensive Income (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Statements Of Income and Comprehensive Income [Abstract] | ' | ' | ' |
Revenues | $125,717,630 | $151,116,806 | $150,747,316 |
Cost of sales | -102,392,031 | -124,060,559 | -117,797,241 |
Gross Profit | 23,325,599 | 27,056,247 | 32,950,075 |
Selling, general and administrative expenses | -4,567,079 | -3,360,520 | -2,517,530 |
Loss on impairment of assets | ' | -2,762,349 | ' |
Gain (Loss) from disposal of property, plant and equipment, net | 84,972 | 45,288 | -321,200 |
Income from Operations | 18,843,492 | 20,978,666 | 30,111,345 |
Other Income (Expense): | ' | ' | ' |
Interest income | 90,260 | 30,674 | 36,437 |
Subsidy income | 171,125 | ' | ' |
Interest expense | -995,694 | -871,834 | -699,892 |
Income before Income Taxes | 18,109,183 | 20,137,506 | 29,447,890 |
Provision for Income Taxes | -5,094,535 | -5,464,843 | -7,799,226 |
Net income | 13,014,648 | 14,672,663 | 21,648,664 |
Other Comprehensive Income: | ' | ' | ' |
Foreign currency translation adjustment | 4,818,869 | 884,872 | 4,304,334 |
Total Comprehensive Income | $17,833,517 | $15,557,535 | $25,952,998 |
Earnings Per Share: | ' | ' | ' |
Basic and Fully Diluted Earnings per Share | $0.71 | $0.79 | $1.18 |
Weighted Average Number of Shares Outstanding - Basic and Fully Diluted | 18,458,446 | 18,456,781 | 18,349,332 |
Consolidated_Statements_of_Cha
Consolidated Statements of Changes in Stockholders' Equity (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Statutory Earnings Reserve [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings [Member] |
Beginning balance at Dec. 31, 2010 | $101,542,076 | $18,345 | $45,727,656 | $5,661,587 | $7,138,233 | $42,996,255 |
Beginning balance, Shares at Dec. 31, 2010 | ' | 18,344,811 | ' | ' | ' | ' |
Issuance of shares to officer and directors | 30,369 | 5 | 30,364 | ' | ' | ' |
Issuance of shares to officer and directors, Shares | ' | 5,380 | ' | ' | ' | ' |
Foreign currency translation adjustment | 4,304,334 | ' | ' | ' | 4,304,334 | ' |
Transfer to statutory earnings reserve | ' | ' | ' | 201,855 | ' | -201,855 |
Net income | 21,648,664 | ' | ' | ' | ' | 21,648,664 |
Balance at Dec. 31, 2011 | 127,525,443 | 18,350 | 45,758,020 | 5,863,442 | 11,442,567 | 64,443,064 |
Balance, Shares at Dec. 31, 2011 | ' | 18,350,191 | ' | ' | ' | ' |
Issuance of shares to officer and directors | 378,065 | 110 | 377,955 | ' | ' | ' |
Issuance of shares to officer and directors, Shares | ' | 109,584 | ' | ' | ' | ' |
Foreign currency translation adjustment | 884,872 | ' | ' | ' | 884,872 | ' |
Transfer to statutory earnings reserve | ' | ' | ' | 100,518 | ' | -100,518 |
Cash dividend paid | -692,242 | ' | ' | ' | ' | -692,242 |
Net income | 14,672,663 | ' | ' | ' | ' | 14,672,663 |
Balance at Dec. 31, 2012 | 142,768,801 | 18,460 | 46,135,975 | 5,963,960 | 12,327,439 | 78,322,967 |
Balance, Shares at Dec. 31, 2012 | ' | 18,459,775 | ' | ' | ' | ' |
Issuance of shares to officer and directors | 790,020 | 297 | 789,723 | ' | ' | ' |
Issuance of shares to officer and directors, Shares | ' | 297,000 | ' | ' | ' | ' |
Foreign currency translation adjustment | 4,818,869 | ' | ' | ' | 4,818,869 | ' |
Transfer to statutory earnings reserve | ' | ' | ' | 74,446 | ' | -74,446 |
Cash dividend paid | -323,032 | ' | ' | ' | ' | -323,032 |
Cancellation of certain director compensation shares | -16,158 | -3 | -16,155 | ' | ' | ' |
Cancellation of certain director compensation shares, Shares | ' | -2,875 | ' | ' | ' | ' |
Net income | 13,014,648 | ' | ' | ' | ' | 13,014,648 |
Balance at Dec. 31, 2013 | $161,053,148 | $18,754 | $46,909,543 | $6,038,406 | $17,146,308 | $90,940,137 |
Balance, Shares at Dec. 31, 2013 | ' | 18,753,900 | ' | ' | ' | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Cash Flows from Operating Activities: | ' | ' | ' |
Net income | $13,014,648 | $14,672,663 | $21,648,664 |
Adjustments to reconcile net income to net cash provided by operating activities | ' | ' | ' |
Depreciation and amortization | 7,794,743 | 8,382,859 | 4,424,531 |
(Gain) Loss from impairment and disposal of property, plant and equipment | -84,972 | -45,288 | 321,200 |
Allowance for (Recovery from) bad debts | 7,990 | -19,631 | 37,087 |
Stock-based expense for service received | 773,862 | 378,065 | 30,369 |
Deferred tax | 409,665 | -941,207 | ' |
Changes in operating assets and liabilities: | ' | ' | ' |
Accounts and notes receivable | -402,709 | 1,029,978 | -1,597,193 |
Prepayments and other current assets | 1,211,679 | -295,763 | -4,803,656 |
Inventories | 4,105,876 | -5,024,459 | -2,246,090 |
Accounts payable | -117,308 | -1,771,968 | 2,299,240 |
Notes payable | 1,614,387 | 3,168,769 | ' |
Accrued payroll and employee benefits | 194,795 | -17,306 | -39,473 |
Other payables and accrued liabilities | 1,599,375 | 453,546 | -1,402,290 |
Income taxes payable | -200,090 | -500,641 | -42,340 |
Net Cash Provided by Operating Activities | 29,921,941 | 22,231,966 | 18,630,049 |
Cash Flows from Investing Activities: | ' | ' | ' |
Purchases of property, plant and equipment | -384,794 | -13,518,955 | -25,424,280 |
Payment for construction in progress | -64,181,991 | -2,759,997 | -2,298,633 |
Refund of prepayment for purchase of property, plant and equipment | ' | 3,112,571 | ' |
Security deposit from a related party | 1,614,387 | 1,075,095 | ' |
Proceeds from disposal of property, plant and equipment | 2,589,919 | 175,593 | 271,508 |
Net Cash Used in Investing Activities | -60,362,479 | -11,915,693 | -27,451,405 |
Cash Flows from Financing Activities: | ' | ' | ' |
Proceeds from related party loans | 1,390,802 | 1,030,097 | 200,000 |
Repayments of related party loans | -1,390,802 | -1,230,097 | -2,091,596 |
Proceeds from bank loans | 10,703,389 | 5,941,441 | 8,389,626 |
Proceeds from sale-leaseback financing | 24,215,811 | ' | ' |
Payment of capital lease obligation | -5,406,481 | ' | ' |
Repayments of bank loans | -8,281,807 | -4,832,372 | -5,001,239 |
Restricted cash | -807,194 | -1,584,384 | ' |
Dividend paid | -323,032 | -692,242 | ' |
Net Cash Provided by (Used in) Financing Activities | 20,100,686 | -1,367,557 | 1,496,791 |
Effect of Exchange Rate Changes on Cash and Cash Equivalents | 330,727 | 26,126 | 141,903 |
Net (Decrease) Increase in Cash and Cash Equivalents | -10,009,125 | 8,974,842 | -7,182,662 |
Cash and Cash Equivalents - Beginning of Period | 13,140,288 | 4,165,446 | 11,348,108 |
Cash and Cash Equivalents - End of Period | 3,131,163 | 13,140,288 | 4,165,446 |
Supplemental Disclosure of Cash Flow Information: | ' | ' | ' |
Cash paid for interest, net of capitalized interest cost | 708,089 | 486,278 | 689,869 |
Cash paid for income taxes | $4,884,961 | $6,909,690 | $7,841,566 |
Organization_and_Business_Back
Organization and Business Background | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Organization and Business Background [Abstract] | ' | ||||||||
Organization and Business Background | ' | ||||||||
(1) Organization and Business Background | |||||||||
Orient Paper, Inc. (“Orient Paper” or “the Company”) was incorporated under the laws of the State of Nevada on December 9, 2005, under the name of Carlateral, Inc. Carlateral, Inc. started its business by providing financing services specializing in subprime title loans, secured primarily using automobiles (and also boats, recreational vehicles, machinery, and other equipment) as collateral. | |||||||||
Hebei Baoding Orient Paper Milling Company Limited (“Orient Paper HB”) was incorporated on March 10, 1996, under the laws of the People’s Republic of China (“PRC”). Orient Paper HB is mainly engaged in the production and distribution of paper products such as corrugating medium paper and offset printing paper. Orient Paper HB also has capability to produce other paper and packaging-related products, such as plastic paper and craft paper. Orient Paper HB uses recycled paper as its primary raw material. | |||||||||
Dongfang Zhiye Holding Limited (“Dongfang Holding”) was formed on November 13, 2006, under the laws of the British Virgin Islands, and is an investment holding company. As such, Dongfang Holding does not generate any financial or operating transactions. On July 16, 2007, Dongfang Holding entered into an agreement to acquire the equity ownership of Orient Paper HB and placed all the equity interest in trust with Mr. Zhenyong Liu, Mr. Xiaodong Liu, and Mr. Shuangxi Zhao (the original equity owners of Orient Paper HB, each, an “Orient Paper HB Equity Owner” and collectively, “Orient Paper HB Equity Owners”), pursuant to a trust agreement executed on the same date. Under the terms of the trust agreement, the Orient Paper HB Equity Owners would exercise control over the disposition of Dongfang Holding’s shares in Orient Paper HB on Dongfang Holding’s behalf until Dongfang Holding successfully completed the change in registration of Orient Paper HB’s capital with the relevant PRC Administration of Industry and Commerce as the 100% owner of Orient Paper HB’s equity interest. In connection with the consummation of the restructuring transactions on June 24, 2009 as described below, Dongfang Holding directed its trustee to return its equity ownership in Orient Paper HB to the Orient Paper HB Equity Owners. | |||||||||
On October 29, 2007, Orient Paper entered into an Agreement and Plan of Merger (“Merger Agreement”) with (i) Orient Paper wholly owned subsidiary, CARZ Merger Sub, Inc., (ii) Dongfang Holding, and (iii) all shareholders of Dongfang Holding (Zhenyong Liu, Xiaodong Liu, Chen Li, Ning Liu, Jie Liu, Shenzhen Huayin Guaranty & Investment Company Limited, Top Good International Limited, Total Giant Group Limited, Total Shine Group Limited, Victory High Investment Limited, Think Big Trading Limited, Huge Step Enterprises Limited, and Sure Believe Enterprise Limited). | |||||||||
Pursuant to the Merger Agreement, Dongfang Holding merged with CARZ Merger Sub, Inc. via a share exchange, with Dongfang Holding as the surviving entity. In exchange for their shares in Dongfang Holding, the Dongfang Holding shareholders received an aggregate of 7,450,497 newly-issued shares of Orient Paper’s common stock, $0.001 par value, which were distributed pro ratably among the Dongfang Holding shareholders in accordance with their respective ownership interests in Dongfang Holding. | |||||||||
As a result of the merger transaction, Dongfang Holding became a wholly-owned subsidiary of Orient Paper, which, in turn, has the controlling right on Dongfang Holding’s operating company, Orient Paper HB, pursuant to the terms of the trust agreement. Orient Paper HB, the entity through which the Company operates its business currently has no subsidiaries, either wholly- or partially-owned. | |||||||||
Prior to the completion of the reverse merger, Orient Paper only had limited operations (since its incorporation on December 9, 2005). On December 21, 2007, the name of the Company was changed from Carlateral, Inc. to Orient Paper, Inc. in order to better reflect the current business plan subsequent to the reverse merger. Accordingly, the reverse merge has been recorded as a recapitalization of Orient Paper. | |||||||||
To ensure proper compliance of the Company’s control over the ownership and operations of Orient Paper HB with certain PRC regulations, on June 24, 2009, the Company entered into a series of contractual agreements (the “Contractual Agreements”) with Orient Paper HB and Orient Paper HB Equity Owners via the Company’s wholly owned subsidiary Shengde Holdings, Inc. (“Shengde Holdings”) a Nevada corporation and Baoding Shengde Paper Co., Ltd. (“Orient Paper Shengde”), a wholly foreign-owned enterprise in the PRC with an original registered capital of $10,000,000 (subsequently increased to $60,000,000 in June 2010). Orient Paper Shengde is mainly engaged in production and distribution of digital photo paper and is 100% owned by Shengde Holdings. Prior to February 10, 2010, the Contractual Agreements included (i) Exclusive Technical Service and Business Consulting Agreement, which generally provides that Orient Paper Shengde shall provide exclusive technical, business and management consulting services to Orient Paper HB, in exchange for service fees including a fee equivalent to 80% of Orient Paper HB’s total annual net profits; (ii) Loan Agreement, which provides that Orient Paper Shengde will make a loan in the aggregate principal amount of $10,000,000 to Orient Paper HB Equity Owners in exchange for each such shareholder agreeing to contribute all of its proceeds from the loan to the registered capital of Orient Paper HB; (iii) Call Option Agreement, which generally provides, among other things, that Orient Paper HB Equity Owners irrevocably grant to Orient Paper Shengde an option to purchase all or part of each owner’s equity interest in Orient Paper HB. The exercise price for the options shall be RMB1 which Orient Paper Shengde should pay to each of Orient Paper HB Equity Owner for all their equity interests in Orient Paper HB; (iv) Share Pledge Agreement, which provides that Orient Paper HB Equity Owners will pledge all of their equity interests in Orient Paper HB to Orient Paper Shengde as security for their obligations under the other agreements described in this section. Specifically, Orient Paper Shengde is entitled to dispose of the pledged equity interests in the event that Orient Paper HB Equity Owners breach their obligations under the Loan Agreement or Orient Paper HB fails to pay the service fees to Orient Paper Shengde pursuant to the Exclusive Technical Service and Business Consulting Agreement; and (v) Proxy Agreement, which provides that Orient Paper HB Equity Owners shall irrevocably entrust a designee of Orient Paper Shengde with such shareholder’s voting rights and the right to represent such shareholder to exercise such owner’s rights at any equity owners’ meeting of Orient Paper HB or with respect to any equity owner action to be taken in accordance with the laws and Orient Paper HB’s Articles of Association. The terms of the agreement are binding on the parties for as long as Orient Paper HB Equity Owners continue to hold any equity interest in Orient Paper HB. An Orient Paper HB Equity Owner will cease to be a party to the agreement once it transfers its equity interests with the prior approval of Orient Paper Shengde. As the Company had controlled Orient Paper HB since July 16, 2007 through Dongfang Holding and the trust until June 24, 2009, and continues to control Orient Paper HB through Orient Paper Shengde and the Contractual Agreements, the execution of the Contractual Agreements is considered as a business combination under common control. | |||||||||
On February 10, 2010, Orient Paper Shengde and the Orient Paper HB Equity Owners entered into a Termination of Loan Agreement to terminate the above $10,000,000 Loan Agreement. Because of the Company’s decision to fund future business expansions through Orient Paper Shengde instead of Orient Paper HB, the $10,000,000 loan contemplated was never made prior to the point of termination. The parties believe the termination of the Loan Agreement does not in itself compromise the effective control of the Company over Orient Paper HB and its businesses in the PRC. | |||||||||
An agreement was also entered into among Orient Paper Shengde, Orient Paper HB and the Orient Paper HB Equity Owners on December 31, 2010, reiterating that Orient Paper Shengde is entitled to 100% of the distributable profit of Orient Paper HB, pursuant to the above mentioned Contractual Agreements. In addition, Orient Paper HB and the Orient Paper HB Equity Owners shall not declare any of Orient Paper HB’s unappropriated earnings as dividend, including the unappropriated earnings of Orient Paper HB from its establishment to 2010 and thereafter. | |||||||||
Orient Paper has no direct equity interest in Orient Paper HB. However, through the Contractual Agreements described above Orient Paper is found to be the primary beneficiary of Orient Paper HB and is deemed to have the effective control over Orient Paper HB’s activities that most significantly affect its economic performance, resulting in Orient Paper HB being treated as a controlled variable interest entity of Orient Paper in accordance with Topic 810 - Consolidation of the Accounting Standards Codification (the “ASC”) issued by the Financial Accounting Standard Board (the “FASB”). The revenue of the Company generated from Orient Paper HB for the years ended December 31, 2013, 2012 and 2011 were 96.05%, 95.91% and 94.5%, respectively. Orient Paper HB also accounted for 80.25% and 73.51% of the total assets of the Company as at December 31, 2013 and 2012 respectively. | |||||||||
As of December 31, 2013 and 2012, details of the Company’s subsidiaries and variable interest entities are as follows: | |||||||||
Date of Incorporation | Place of Incorporation | Percentage of | |||||||
Name | or Establishment | or Establishment | Ownership | Principal Activity | |||||
Subsidiary: | |||||||||
Dongfang Holding | 13-Nov-06 | BVI | 100% | Inactive investment holding | |||||
Shengde Holdings | 25-Feb-09 | State of Nevada | 100% | Investment holding | |||||
Orient Paper Shengde | 1-Jun-09 | PRC | 100% | Paper Production and distribution | |||||
Variable interest entity: | |||||||||
Orient Paper HB | 10-Mar-96 | PRC | Control* | Paper Production and distribution | |||||
* Orient Paper HB is treated as a 100% controlled variable interest entity of the Company |
Significant_Accounting_Policie
Significant Accounting Policies | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Significant Accounting Policies [Abstract] | ' | |||||||||||
Significant Accounting Policies | ' | |||||||||||
(2) Significant Accounting Policies | ||||||||||||
Basis of Consolidation | ||||||||||||
The consolidated financial statements of the Company are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”), and include the assets, liabilities, revenues, expenses and cash flows of all subsidiaries and variable interest entity. All significant inter-company balances, transactions and cash flows are eliminated on consolidation. | ||||||||||||
Foreign Currency Translation | ||||||||||||
The Company accounts for foreign currency translation pursuant to ASC Topic 830, Foreign Currency Matters. The functional currency of Orient Paper HB and Orient Paper Shengde is the Chinese Yuan Renminbi (“RMB”). Monetary assets and liabilities denominated in currencies other than RMB are translated into RMB at the rates of exchange ruling at the balance sheet date. Transactions in currencies other than RMB are converted into RMB at the applicable rates of exchange prevailing the transactions occurred. Transaction gains and losses are recognized in the consolidated statements of income. The functional currency of Orient Paper, Dongfang Holding and Shengde Holdings is United States dollars. Monetary assets and liabilities denominated in currencies other than United States dollars are translated into United States dollars at the rates of exchange ruling at the balance sheet date. Translation in currencies other than United States dollars are converted into United States dollars at the applicable rates of exchange prevailing when the transactions occurred. Transaction gains or losses are recognized in the consolidated statement of income. | ||||||||||||
Under ASC Topic 830-30, all assets and liabilities are translated into United States dollars using the current exchange rate at the end of each fiscal period. The current exchange rates used by the Company as of December 31, 2013 and 2012 to translate the Chinese RMB to the U.S. Dollars are 6.11220:1, and 6.30860:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.19430:1, 6.31160:1 and 6.45440:1 for the years ended December 31, 2013, 2012 and 2011, respectively. Translation adjustments are included in other comprehensive income (loss). | ||||||||||||
Use of Estimates | ||||||||||||
The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of December 31, 2013 and 2012, and revenues and expenses for the years ended December 31, 2013, 2012 and 2011. The most significant estimates relate to allowance for uncollectible accounts receivable, inventory valuation, useful lives and impairment for property, plant and equipment, valuation allowance for deferred tax assets and contingencies. Actual results could differ from those estimates made by management. | ||||||||||||
Cash and Cash Equivalents | ||||||||||||
For purposes of reporting within the statements of cash flows, Orient Paper considers all cash on hand, cash accounts not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash and cash equivalents. | ||||||||||||
Accounts Receivable | ||||||||||||
Trade accounts receivable are recorded on shipment of products to customers. The trade receivables are all without customer collateral and interest is not accrued on past due accounts. Periodically, management reviews the adequacy of its provision for doubtful accounts based on historical bad debt expense results and current economic conditions using factors based on the aging of its accounts receivable. Additionally, the Company may identify additional allowance requirements based on indications that a specific customer may be experiencing financial difficulties. Actual bad debt results could differ materially from these estimates. As of December 31, 2013 and 2012, the balance of allowance for doubtful accounts was $67,592 and $57,643, respectively; and the movement of the provision of the doubtful accounts is as below. While management uses the best information available upon which to base estimates, future adjustments to the allowance may be necessary if economic conditions differ substantially from the assumptions used for the purposes of analysis. | ||||||||||||
December 31, | December 31, | December 31, | ||||||||||
Allowance of doubtful accounts | 2013 | 2012 | 2011 | |||||||||
Opening balance | $ | 57,643 | $ | 76,752 | $ | 37,535 | ||||||
Provision (Reversal of provision) for the year | 7,990 | (19,631 | ) | 37,087 | ||||||||
Exchange difference | 1,959 | 522 | 2,130 | |||||||||
Closing balance | $ | 67,592 | $ | 57,643 | $ | 76,752 | ||||||
Inventories | ||||||||||||
Inventories consist principally of raw materials and finished goods, and are stated at the lower of cost (average cost method) or market. Cost includes labor, raw materials, and allocated overhead. No provision in inventories has been provided for the fiscal years 2013, 2012 and 2011. | ||||||||||||
Property, Plant, and Equipment | ||||||||||||
Property, plant, and equipment are stated at cost less accumulated depreciation and any impairment losses. Major renewals, betterments, and improvements are capitalized to the asset accounts while replacements, maintenance, and repairs, which do not improve or extend the lives of the respective assets, are expensed to operations. At the time property, plant, and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation or amortization accounts are relieved of the applicable amounts. Gains or losses from retirements or sales are credited or charged to operations. | ||||||||||||
Construction-in-progress is stated at cost and capitalized as expenses are incurred or as payments are made pursuant to relevant construction contracts. Contract retention is recorded as accrued liability. Construction in progress is not depreciated until project completion and the constructed property being placed in service, at which time the capitalized balance will be transferred to appropriate account of property, plant and equipment. | ||||||||||||
The Company depreciates property, plant, and equipment using the straight-line method as follows: | ||||||||||||
Land use right | Over the lease term | |||||||||||
Building and improvements | 30 years | |||||||||||
Machinery and equipment | 5-15 years | |||||||||||
Vehicles | 15 years | |||||||||||
Valuation of long-lived asset | ||||||||||||
The Company reviews the carrying value of long-lived assets to be held and used when events and circumstances warrants such a review. The carrying value of a long-lived asset is considered impaired when the anticipated undiscounted cash flow from such asset is separately identifiable and is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair market value of the long-lived asset and intangible assets. Fair market value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. Losses on long-lived assets and intangible assets to be disposed are determined in a similar manner, except that fair market values are reduced for the cost to dispose. | ||||||||||||
Assets held for sale | ||||||||||||
When assets are identified by management as held for sale, the Company discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets. If, in management's opinion, the estimated net sales price of the assets which have been identified as held for sale is less than the net book value of the assets, a valuation allowance is established. Properties identified as held for sale and/or disposed of are presented as Assets held for sale for all periods presented. | ||||||||||||
If circumstances arise that previously were considered unlikely and, as a result, the Company decides not to sell a property previously classified as held for sale, the property is reclassified as held and used. A property that is reclassified is measured and recorded individually at the lower of (a) its carrying amount before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell. | ||||||||||||
Fair Value of Financial Instruments | ||||||||||||
The Company estimates the fair value of financial instruments using the available market information and valuation methods. Considerable judgment is required in estimating fair value. Accordingly, the estimates of fair value may not be indicative of the amounts that the Company could realize in a current market exchange. As of December 31, 2013 and 2012, the carrying value of the Company’s short term financial instruments, such as cash and cash equivalents, accounts receivable, accounts and notes payable, and balance due to a related party, approximate at their fair values because of the short maturity of these instruments; while bank loans, loan from a related party and obligation under capital lease approximate at their fair value as the interest rates thereon are close to the market rates of interest published by the People’s Bank of China. | ||||||||||||
Statutory Reserves | ||||||||||||
According to the laws and regulations in the PRC, the Company is required to provide for certain statutory funds, namely, reserve fund by an appropriation from net profit after taxation but before dividend distribution based on the local statutory financial statements of the PRC subsidiary and variable interest entity prepared in accordance with the PRC accounting principles and relevant financial regulations. | ||||||||||||
The Company’s wholly owned subsidiary and variable interest entity in the PRC are required to allocate at least 10% of its net profit to the reserve fund until the balance of such fund has reached 50% of its registered capital. Appropriations of additional reserve fund are determined at the discretion of its directors. The reserve fund can only be used, upon approval by the relevant authority, to offset accumulated losses or increase capital. | ||||||||||||
For the years ended December 31, 2013, 2012 and 2011, Orient Paper made transfers to this reserve fund in the amounts of $74,446, $100,518, and $201,855, respectively. For the years ended December 31, 2013, 2012 and 2011, all transfers to statutory reserves were made by Orient Paper Shengde. The Company’s variable interest entity Orient Paper HB, which statutory reserve account has been fully funded for 50% of its registered capital in the amount of RMB 75,030,000 (or approximately $11,811,470) as of December 31, 2010, did not make any transfer to statutory reserves during the years ended December 31, 2013, 2012 and 2011. | ||||||||||||
Employee Benefit Plan | ||||||||||||
Full time employees of the PRC entities participate in a government mandated multi-employer defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance and other welfare benefits are provided to employees. The total provision for such employee benefits was $nil, $nil and $nil for the years ended December 31, 2013, 2012 and 2011. | ||||||||||||
Revenue Recognition Policy | ||||||||||||
The Company recognizes revenue when goods are delivered, when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist, and collectability is reasonably assured. Goods are considered delivered when customer’s truck picks up goods at our finished goods inventory warehouse. | ||||||||||||
Shipping Cost | ||||||||||||
Substantially all customers use their own trucks or hire commercial trucking companies to pick up goods from the Company. The Company usually incurs no shipping cost for delivery of goods to customers. For those rare situations where products are not shipped utilizing customer specified shipping services, the Company charges customers a shipping fee which is included in net revenues and was not material. Freight-in and handling costs incurred by the Company with respect to purchased goods are recorded as a component of inventory cost and charged to cost of sales when the inventory items are sold. | ||||||||||||
Advertising | ||||||||||||
The Company expenses all advertising and promotion costs as incurred. The Company incurred $5,085, $10,478 and $6,818 of advertising and promotion costs for the years ended December 31, 2013, 2012 and 2011, respectively. | ||||||||||||
Research and development costs | ||||||||||||
Research and development costs are expensed as incurred and included in selling, general and administrative expenses. Research and development expenses incurred $25,125, $21,636 and $19,756 for the years ended December 31, 2013, 2012 and 2011, respectively. | ||||||||||||
Borrowing costs | ||||||||||||
Borrowing costs attributable directly to the acquisition, construction or production of qualifying assets which require a substantial period of time to be ready for their intended use or sale, are capitalized as part of the cost of those assets. Income earned on temporary investments of specific borrowings pending their expenditure on those assets is deducted from borrowing costs capitalized. All other borrowing costs are recognized in interest expenses in the period in which they are incurred. | ||||||||||||
Government subsidies | ||||||||||||
A government subsidy is not recognized until there is reasonable assurance that: (a) the enterprise will comply with the conditions attached to the grant; and (b) the grant will be received. When the Company received the government subsidies but the conditions attached to the grants have not been fulfilled, such government subsidies are deferred and recorded under other payables and accrued expenses, and other long-term liability. The reclassification of short-term or long-term liabilities is depended on the management's expectation of when the conditions attached to the grant can be fulfilled. For the years ended December 31, 2013, 2012 and 2011, the Company received government subsidies of $171,125, $nil and $nil, which are recognized as subsidy income in the statements of income in that fiscal year. | ||||||||||||
Lease Obligations | ||||||||||||
All non-cancellable leases with an initial term greater than one year are categorized as either capital or operating leases. For the lessee, a lease is a capital lease if any of the following conditions exist: a) ownership is transferred to the lessee by the end of the lease term, b) there is a bargain purchase option, c) the lease term is at least 75% of the property’s estimated remaining economic life or d) the present value of the minimum lease payments at the beginning of the lease term is 90% or more of the fair value of the leased property to the lessor at the inception date. A capital lease is accounted for as if there was an acquisition of an asset and an incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases. Assets recorded under capital leases are amortized according to the same depreciation methods employed for property, plant and equipment or over the term of the related lease, if shorter. | ||||||||||||
The Company defers any profit or loss from a sale-leaseback transaction unless any of the following conditions exist: a) the seller-lessee relinquishes the right to substantially all of the remaining use of the property sold retaining only a minor portion of such use; b) the seller-lessee retains more than a minor part but less than substantially all of the use of the property through the leaseback and realizes a profit on the sale in excess of the recorded amount of the leased assets; or c) the fair value of the property at the time of the transaction is less than its undepreciated cost, in which circumstance a loss shall be recognized immediately. | ||||||||||||
Income Taxes | ||||||||||||
The Company accounts for income taxes pursuant to ASC Topic 740, Income Taxes. Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Any tax paid by subsidiaries during the year is recorded. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. ASC Topic 740 also requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carry-forwards. ASC Topic 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets, including those related to the U.S. net operating loss carry-forwards, are dependent upon future earnings, if any, of which the timing and amount are uncertain. | ||||||||||||
The Company adopted ASC Topic 740-10-05, Income Tax, which provides guidance for recognizing and measuring uncertain tax positions, it prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the financial statements. It also provides accounting guidance on derecognizing, classification and disclosure of these uncertain tax positions. | ||||||||||||
The Company’s policy on classification of all interest and penalties related to unrecognized income tax positions, if any, is to present them as a component of income tax expense. | ||||||||||||
Value Added Tax | ||||||||||||
Both the PRC subsidiary and variable interest entity of the Company are subject to value added tax (“VAT”) imposed by the PRC government on its purchase and sales of goods. The output VAT is charged to customers who purchase goods from the Company and the input VAT is paid when it purchases goods from its vendors. VAT rate is 17% in general, depending on the types of products purchased and sold. The input VAT can be offset against the output VAT. Debit balance of VAT payable represents a credit against future collection of output VAT instead of a receivable. | ||||||||||||
Comprehensive Income (Loss) | ||||||||||||
The Company presents comprehensive income (loss) in accordance with ASC Topic 220, Comprehensive Income. ASC Topic 220 states that all items that are required to be recognized under accounting standards as components of comprehensive income (loss) be reported in the consolidated financial statements. The components of comprehensive income were the net income for the years and the foreign currency translation adjustments. | ||||||||||||
Earnings Per Share | ||||||||||||
Basic earnings per share is computed by dividing the net income attributable to the common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. | ||||||||||||
Share-Based Compensation | ||||||||||||
The Company uses the fair value recognition provision of ASC Topic 718, Compensation-Stock Compensation, which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of such instruments over the vesting period. | ||||||||||||
The Company also applies the provisions of ASC Topic 505-50, Equity Based Payments to Non-Employees to account for stock-based compensation awards issued to non-employees for services. Such awards for services are recorded at either the fair value of the consideration received or the fair value of the instruments issued in exchange for such services, whichever is more reliably measurable. | ||||||||||||
Fair Value Measurements | ||||||||||||
The Company has adopted ASC Topic 820, Fair Value Measurements and Disclosures, which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. It does not require any new fair value measurements, but provides guidance on how to measure fair value by providing a fair value hierarchy used to classify the source of the information. | ||||||||||||
Its establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable inputs, which may be used to measure fair value and include the following: | ||||||||||||
Level 1 - Quoted prices in active markets for identical assets or liabilities. | ||||||||||||
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||||||||||||
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | ||||||||||||
Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement. | ||||||||||||
Non-Recurring Fair Value Measurements | ||||||||||||
Long-lived assets are measured at fair value on a non-recurring basis using mostly Level 3 inputs as defined in the fair value hierarchy. These assets are not measured at fair value on an ongoing basis, but are subject to fair value adjustments only in certain circumstances. Assets that are written down to fair value when impaired and retained investments are not subsequently adjusted to fair value unless further impairment occurs. | ||||||||||||
Fair value of long-lived assets, including real estate, are determined by estimating the amount and timing of net future cash flows (which are unobservable inputs) and discounting them using a risk-adjusted rate of interest. The Company estimates future cash flows based on its experience and knowledge of the market. Significant increases or decreases in actual cash flows may result in valuation changes. For real estate, fair values are based on discounted cash flow estimates which reflect current and projected lease profiles and available industry information about capitalization rates and expected trends in rents and occupancy and are corroborated by external appraisals. | ||||||||||||
Working Capital Deficit and Management’s Plan. | ||||||||||||
As of December 31, 2013, the Company had current assets of $25,953,328 and current liabilities of $28,372,723 (including amounts due to related parties for $2,266,961), resulting in a working capital deficit of approximately $2,419,395. We are currently seeking to restructure the term of our liabilities by raising funds through long-term loans to pay off liabilities with shorter terms. Our ability to continue as a going concern is dependent upon obtaining the necessary financing or negotiating the terms of the existing short-term liabilities to meet our current and future liquidity needs. As management believes it can secure financial resources to satisfy the Company’s current liabilities and the capital expenditure needs in the next 12 months, our consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern. | ||||||||||||
On March 3, 2014 Orient Paper entered into a Revolving Line of Credit Agreement with Shanghai Pudong Development Bank for a total credit facility in the amount of approximately $3.3 million. Pursuant to the credit facility, the Company may draw six-month bank acceptance notes for up to approximately $3.3 million for making supplier payments. The facility has a term for the period of March 3, 2014 through January 12, 2015 and is collateralized by a land use right provided by Hebei Fangsheng Real Estate Development Co. Ltd., a related party controlled by our Chairman and CEO Mr. Zhenyong Liu. | ||||||||||||
On March 25, 2014, our Chairman and CEO Mr. Zhenyong Liu agrees in writing to permit the Company to continue to postpone the repayment of the accrued interest on his loan to Orient Paper HB until the Company is able to pay its other creditors in its normal course of business. The accrued interest owned to Mr. Liu was approximately $566,343 and was recorded as part of the current liabilities as of December 31, 2013. | ||||||||||||
On March 7, 2014, Hebei Tengsheng Paper Co. Ltd., which owns the land use rights of about 330 acres (or 1.33 million square meters) of land in the Wei County Industrial Park and leases about one-fourth of the premises to Orient Paper HB as our production base of tissue paper and other future facilities, agreed in writing to unconditionally provide the 330 acres of land use right as third party collateral to Orient Paper HB for additional bank loans in 2014. |
Restricted_Cash
Restricted Cash | 12 Months Ended |
Dec. 31, 2013 | |
Restricted Cash [Abstract] | ' |
Restricted Cash | ' |
(3) Restricted Cash | |
Restricted cash of $2,454,108 as of December 31, 2013 was presented for the cash deposited at the Bank of Hebei for purpose of securing the bank acceptance notes from the bank (see Note (12)). The restriction will be lifted upon the maturity of the notes payable from May 15 through June 19 during the year of 2014. | |
Restricted cash of $1,585,138 as of December 31, 2012 was presented for the cash deposited at the Bank of Hebei for purpose of securing the bank acceptance notes from the bank (see Note (12)). The restriction was lifted upon the maturity of the notes payable on June 18, 2013. |
Inventories
Inventories | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Inventories [Abstract] | ' | ||||||||
Inventories | ' | ||||||||
(4) Inventories | |||||||||
Raw materials inventory includes mainly recycled paper and coal. Finished goods include mainly products of corrugating medium paper and offset printing paper. Inventories consisted of the following as of December 31, 2013 and 2012: | |||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Raw Materials | |||||||||
Recycled paper board | $ | 8,004,988 | $ | 11,274,383 | |||||
Pulp | 14,257 | 13,813 | |||||||
Recycled printed paper | - | 884,236 | |||||||
Recycled white scrap paper | 1,791,873 | 766,144 | |||||||
Coal | 573,799 | 621,107 | |||||||
Base paper and other raw materials | 212,984 | 225,912 | |||||||
10,597,901 | 13,785,595 | ||||||||
Finished Goods | 830,504 | 1,318,506 | |||||||
Totals | $ | 11,428,405 | $ | 15,104,101 | |||||
Prepayments_and_Other_Current_
Prepayments and Other Current Assets | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Prepayments and Other Current Assets [Abstract] | ' | ||||||||
Prepayments and other current assets | ' | ||||||||
(5) Prepayments and other current assets | |||||||||
Prepayments and other current assets consisted of the following as of December 31, 2013 and 2012: | |||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Prepaid NYSE MKT annual fee | $ | 7,500 | $ | 6,875 | |||||
Recoverable VAT | 500,000 | 4,784,074 | |||||||
Prepaid insurance | 61,529 | 55,922 | |||||||
Prepayment for purchase of materials | 8,180 | 77,445 | |||||||
Prepaid land lease | 490,822 | 475,541 | |||||||
Others | - | 1,848 | |||||||
$ | 1,068,031 | $ | 5,401,705 | ||||||
As of December 31, 2013, the Company recorded a total recoverable VAT of $3,777,188, out of which $3,277,188 presented as non-current asset in the consolidated balance sheet. As of December 31, 2012, the Company recorded the entire balance of recoverable VAT of $4,784,074 as current asset under prepayments and other current assets in the consolidated balance sheet. |
Prepayment_on_Property_Plant_a
Prepayment on Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2013 | |
Prepayment on Property, Plant and Equipment [Abstract] | ' |
Prepayment on property, plant and equipment | ' |
(6) Prepayment on property, plant and equipment | |
As of December 31, 2013 and 2012, prepayment on property, plant and equipment consisted of $1,492,098 and $1,445,645, respectively in respect of prepaid land use right prepayment made on October 26, 2012 for the entitlement of land use right for some 54,267 square meters of land located in our Xushui County, Baoding plant. The purchase is expected to be completed in year 2014. |
Assets_Held_for_Sale
Assets Held for Sale | 12 Months Ended |
Dec. 31, 2013 | |
Assets Held for Sale [Abstract] | ' |
Assets held for sale | ' |
(7) Assets held for sale | |
As of December 31, 2013, assets held for sale in the amount of $4,130,590 represented the three employee dormitory buildings to be sold to a related party company controlled by our Chairman and CEO Mr. Zhenyong Liu. Please refer to Note (11) for the details of the related party transaction. As the sale was not yet completed by the end of December 31, 2013, the dormitories were classified as held for sale in accordance with ASC 360-10-35. It was expected that the sales will be consummated by the second half of year 2014. |
Property_Plant_and_Equipment
Property, Plant and Equipment | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Property, plant and equipment | ' | ||||||||
(8) Property, plant and equipment | |||||||||
As of December 31, 2013 and 2012, property, plant and equipment consisted of the following: | |||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Property, Plant, and Equipment: | |||||||||
Land use rights | $ | 7,761,511 | $ | 9,895,081 | |||||
Building and improvements | 22,406,836 | 31,625,816 | |||||||
Machinery and equipment | 121,088,942 | 111,857,002 | |||||||
Vehicles | 683,051 | 439,007 | |||||||
Construction in progress | 65,160,213 | 1,315,664 | |||||||
217,100,553 | 155,132,570 | ||||||||
Less: accumulated depreciation and amortization | (38,565,294 | ) | (32,741,114 | ) | |||||
Property, Plant and Equipment, net | $ | 178,535,259 | $ | 122,391,456 | |||||
As of December 31, 2012, land use rights represented two parcels of state-owned land located in Xushui County of Hebei Province in China, with lease terms of 50 years expiring in 2053 and 2061, respectively. On August 9, 2013, one of these land use rights was sold to a related party company controlled by our Chairman and CEO Mr. Zhenyong Liu. See Note (11) for the details of the related party transaction. The remaining land use right as of December 31, 2013 will expire in year 2061. | |||||||||
The Company entered into a sale-leaseback arrangement with a leasing company in China on June 16, 2013 for a total financing proceeds in the amount of RMB150 million (approximately US$24 million). Under the sale-leaseback arrangement, Orient Paper HB sold certain of its paper manufacturing equipment to the leasing company for an amount of RMB 150 million (approximately US$24 million). Concurrent with the sale of equipment, Orient Paper HB leases back all of the equipment (“Leased Equipment”) sold to the leasing company for a lease term of three years. At the end of the lease term, Orient Paper HB may pay a nominal purchase price of RMB 15,000 (approximately $2,400) to the leasing company and buy back all of the Leased Equipment. The sale-leaseback is treated by the Company as a mere financing and capital lease transaction, rather than a sale of assets (under which gain or loss is immediately recognized) under ASC 840-40-25-4. All of the Leased Equipment are included as part of the property, plant and equipment of the Company as of December 31, 2013. As a result of the sale, a deferred gain on sale of Leased Equipment in the amount of $1,379,282 was created at the closing of the transaction and presented as a non-current liability. The deferred gain would be amortized by the Company during the lease term and would be used to offset the depreciation of the Leased Equipment, which are recorded at the new cost of $25,993,677 as of December 31, 2013. See “Financing with Sale-Leaseback” under Note (10), Loans Payable, for details of the transaction and asset collaterals. The depreciation of Leased Equipment has started in July 2013 and was included with the depreciation expense of the Company’s own assets in the consolidated statement of income. During the year ended December 31, 2013, depreciation of Leased Equipment was $818,796. The accumulated depreciation of the leased asset was $829,794 as of December 31, 2013. During the year ended December 31, 2013, the gain realized on sale-leaseback transaction was $228,979. The gain realized was recorded in cost of sales as a reduction of depreciation expenses. The unamortized deferred gain on sale-lease back was $1,160,271 as of December 31, 2013. | |||||||||
Construction in progress mainly represents payments for the new 15,000 tonnes per year tissue paper manufacturing equipment PM8, the tissue paper workshops, four warehouses, office buildings and the new staff dormitory in the Wei County industrial park, as well as the equipment for the renovation of PM1. Tissue paper manufacturing equipment PM8 and ancillary facilities were expected to start installation in the first quarter of year 2014; while the renovation of PM1 is expected to be completed by the third quarter of year 2014. Upon completion, it will bring about an addition of $116,067,537 to the Company’s machinery and equipment. For the years ended December 31, 2013, 2012 and 2011, the amount of interest capitalized is $448,950, $nil and $nil, respectively. | |||||||||
As of December 31, 2013, the three employee dormitory buildings in the amount of $4,130,590, which will be sold to a related party company controlled by our Chairman and CEO Mr. Zhenyong Liu by the second half of year 2014, were reclassified as assets held for sale. Please refer to Note (7) for details. | |||||||||
As of December 31, 2013 and December 31, 2012, certain property, plant and equipment of Orient Paper HB with net values of $21,901,456 and $9,316,645 have been pledged for the long-term loan from credit union of Orient Paper HB, respectively. As of December 31, 2013, certain of the Company’s property, plant and equipment in the amount of $34,177 have been pledged for the facility obtained from Bank of Hebei. See “Notes Payable” under Note (12) for details. In addition, land use right with net values of $7,502,794 as of December 31, 2013 was pledged for the sale-leaseback financing. See “Financing with Sale-Leaseback” under Note (10), Loans Payable, for details of the transaction and asset collaterals. | |||||||||
As of December 31, 2013, essentially all production equipment of Orient Paper Shengde with net value of $36,134,038 has been pledged for the guarantee of Orient Paper HB’s performance under the capital lease. | |||||||||
In addition, as of December 31, 2012, land use right of $7,419,614 was pledged for a bank loan of an independent third party which cross-guarantees the Company’s credit facility from the Bank of Hebei. The amount of that long-term loan of the third party was $1,505,881 as of December 31, 2012 and has been paid off on June 3, 2013. The credit facility guaranteed by the independent third party was expired on September 19, 2013. | |||||||||
Depreciation and amortization of property, plant and equipment was $7,794,743, $8,382,859 and $4,424,531 for the years ended December 31, 2013, 2012 and 2011, respectively. |
Fair_Value_Measurement
Fair Value Measurement | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Fair Value Measurement [Abstract] | ' | ||||||||
Fair Value Measurement | ' | ||||||||
(9) Fair Value Measurement | |||||||||
The following table presents fair values for those assets measured at fair value on a non-recurring basis at December 31, 2013 and 2012: | |||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Long-lived assets | |||||||||
Using Level 1 | $ | - | $ | - | |||||
Using Level 2 | - | - | |||||||
Using Level 3 | - | 1,561,361 | |||||||
Property, Plant and Equipment, net | $ | - | $ | 1,561,361 | |||||
During 2012, the Company recognized $2,762,349 in impairment charges related to its corrugating medium production line PM1. The carrying value of the asset was $4,325,023 and was written down to $1,561,361. The Company used unobservable inputs based on its experience and knowledge of the market, as such, the Company classified the fair value of this asset within Level 3. No impairment charges on property, plant and equipment was made for the year ended December 31, 2013. |
Loans_Payable
Loans Payable | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Loans Payable [Abstract] | ' | |||||||
Loans Payable | ' | |||||||
(10) Loans Payable | ||||||||
Short-term bank loans | ||||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Industrial & Commercial Bank of China | (a) | $ | - | $ | 792,568 | |||
Industrial & Commercial Bank of China | (b) | - | 1,585,138 | |||||
Bank of Hebei | (c) | - | 1,585,138 | |||||
Industrial & Commercial Bank of China | (d) | 4,090,180 | - | |||||
Industrial & Commercial Bank of China | (e) | 818,036 | - | |||||
Industrial & Commercial Bank of China | (f) | 1,636,072 | - | |||||
Total short-term bank loans | $ | 6,544,288 | $ | 3,962,844 | ||||
(a) | On September 4, 2012, the Company refinanced with the Industrial & Commercial Bank of China (“ICBC”) an accounts receivable factoring facility with a maximum credit limit of $792,568 as of December 31, 2012. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company’s books at all times, are not fully collected. The factoring facility carried an interest rate of 6.6% per annum. The Company paid off the principal balance and accrued interest under the factoring facility on August 28, 2013. | |||||||
(b) | On November 9, 2012, the Company obtained from the ICBC another accounts receivable factoring facility with a maximum credit limit of $1,585,138 as of December 31, 2012. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company’s books at all times, are not fully collected. The term of the factoring facility expired on November 8, 2013 and carried an interest rate of 6.6% per annum, or 1.0% plus the prime rate for the loan set forth by the People’s Bank of China at the time of funding. The Company paid off the principal balance and accrued interest under the factoring facility on November 8, 2013. | |||||||
(c) | On September 19, 2012, the Company obtained from the Bank of Hebei a banking facility with maximum credit limit on bank loans of $1,585,138 and on notes payable of $1,585,138 as of December 31, 2012. The facility was guaranteed by an independent third party. On the same day, the Company drew down from this banking facility a new working capital loan of $1,585,138 as of December 31, 2012. The loan bore interest at the rate of 6.6% per annum. Both the term of the banking facility and loan were for one year and expired on September 19, 2013. The Company paid off the loan balance on September 18, 2013. | |||||||
(d) | On September 2, 2013, the Company entered into a working capital loan agreement with the ICBC for $4,090,180, with which $818,036 is payable on June 5, 2014 and $3,272,144 is payable on August 15, 2014. The loan bears an interest rate of 115% over the primary lending rate of the People’s Bank of China and was at 6.9% per annum at the time of funding. | |||||||
Concurrent with the signing of the working capital loan agreement, the Company also entered into a trust agreement with the ICBC, which provides trust account management services to the Company during the terms of the underlying loan. The working capital loan is guaranteed by Hebei Fangsheng Real Estate Development Co. Ltd. (“Hebei Fangsheng”) with the land use right on our Headquarters Compound pledged by Hebei Fangsheng as collateral for the benefit of the bank. The land use right on our Headquarters Compound was acquired by Hebei Fangsheng from the Company on August 9, 2013 (see Note (11) for the related party transaction). Hebei Fangsheng is controlled by the Company’s Chairman and CEO Mr. Zhenyong Liu. | ||||||||
(e) | On September 6, 2013, the Company obtained a new accounts receivable factoring facility from the ICBC for $818,036. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company’s books at all times, are not fully collected. The factoring facility will expire on August 4, 2014 and bears an interest rate of 110% of the primary lending rate of the People’s Bank of China and was at 6.6% per annum at the time of funding. | |||||||
Concurrent with the signing of the new factoring agreement, the Company also entered into a financial service agreement with ICBC, which provides accounts receivable management services to the Company during the terms of the underlying factoring facility. The factoring facility is personally guaranteed by the Company’s Chairman and CEO Mr. Zhenyong Liu. | ||||||||
(f) | On December 3, 2013, the Company obtained from the ICBC an accounts receivable factoring facility with a maximum credit limit of $1,636,072 as of December 31, 2013. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company’s books at all times, are not fully collected. The term of the factoring facility expires on October 21, 2014 and carries an interest rate of 6.6% per annum, or 1.0% plus the prime rate for the loan set forth by the People’s Bank of China at the time of funding. The unpaid balance of the loan was in the amount of $1,636,072 as of December 31, 2013. | |||||||
As of December 31, 2013 and 2012, there were secured short-term borrowings of $6,544,288 and $2,377,706, respectively, and unsecured bank loans of $nil and $1,585,138, respectively. The factoring facility was secured by the Company’s accounts receivable in the amount of $3,272,528 and $2,836,335 as of December 31, 2013 and 2012, respectively. | ||||||||
As of December 31, 2013 and 2012, the Company had no unutilized credit facility for bank loans with the banks. The average short-term borrowing rates for the years ended December 31, 2013, 2012 and 2011 were approximately 6.68%, 7.82% and 6.38%, respectively. | ||||||||
Long-term loans from credit union | ||||||||
As of December 31, 2013 and 2012, loan payable to Rural Credit Union of Xushui County, amounted to $5,914,401 and $5,730,273, respectively. | ||||||||
On March 31, 2011, the Company entered into a three-year term loan agreement with Rural Credit Union of Xushui County for an amount that is $1,611,531 as of December 31, 2013 and $1,561,361 as of December 31, 2012. The loan is guaranteed by an independent third party. Interest payment is due quarterly and bears the rate of 0.72% per month. As of December 31, 2013, the entire balance of the loan in the amount of $1,611,531 was presented as current portion of long-term loan from credit union in the consolidated balance sheet. | ||||||||
On June 10, 2011, the Company entered into a term loan agreement with the Rural Credit Union of Xushui County for an amount that was $4,168,912 as of December 31, 2012. Interest payment is due quarterly and bears the rate of 0.72% per month. The loan is secured by its manufacturing equipment of $9,316,645 as of December 31, 2012, and became matured on June 9, 2013. On July 26, 2013, the Company paid off the unpaid principal balance and accrued interest. | ||||||||
On July 15, 2013, the Company entered into a new agreement with the Rural Credit Union of Xushui County of $4,302,870 for a term of 5 years, which is due and payable on various scheduled repayment dates between December 21, 2013 and July 26, 2018. The loan is secured by certain of the Company’s manufacturing equipments in the amount of $21,901,456 as of December 31, 2013. Interest payment is due quarterly and bears a fixed rate of 0.72% per month. As of December 31, 2013, total outstanding loan balance was $4,302,870, with $49,082 becoming due within one year and presented as current portion of long term loan from credit union in the consolidated balance sheet. | ||||||||
Total interest expenses for the short-term bank loans and long-term loans for the years ended December 31, 2013, 2012 and 2011 were $828,157, $736,457 and $495,978, respectively. | ||||||||
Financing with Sale-Leaseback | ||||||||
The Company entered into a sale-leaseback arrangement (the “Lease Financing Agreement”) with China National Foreign Trade Financial & Leasing Co., Ltd ("CNFTFL") on June 16, 2013, for a total financing proceeds in the amount of RMB150 million (approximately US$24 million). Under the sale-leaseback arrangement, Orient Paper HB sold certain of its paper manufacturing equipment (the “Leased Equipment”) to CNFTFL for an amount of RMB 150 million (approximately US$24 million). Concurrent with the sale of equipment, Orient Paper HB leases back all of the equipment sold to CNFTFL for a lease term of three years. At the end of the lease term, Orient Paper HB may pay a nominal purchase price of RMB 15,000 (approximately $2,400) to CNFTFL and buy back all of the Leased Equipment. The sale-leaseback is treated by the Company as a mere financing and capital lease transaction, rather than a sale of assets (under which gain or loss is immediately recognized) under ASC 840-40-25-4. All of the Leased Equipment are included as part of the property, plant and equipment of the Company’s as of December 31, 2013; while the net present value of the minimum lease payment (including a lease service charge equal to 5.55% of the amount financed, i.e. approximately US$1.36 million) was recorded as obligations under capital lease and was calculated with CNFTFL’s implicit interest rate of 6.15% per annum and stated at $25,750,170 at the inception of the lease on June 16, 2013. The balance of the long-term obligations under capital lease was $12,296,639 as of December 31, 2013, which is net of its current portion in the amount of $8,264,795. | ||||||||
Total interest expenses for the sale-leaseback arrangement for the years ended December 31, 2013, 2012 and 2011 were $471,472, $nil and $nil, respectively. | ||||||||
As a result of the sale, a deferred gain on sale of leased equipment in the amount of $1,379,282 was created at the closing of the transaction and is presented as a non-current liability. The deferred gain would be amortized by the Company during the lease term and would be used to offset the depreciation of the Leased Equipment, which was recorded at the new cost of $25,993,677 as of December 31, 2013. | ||||||||
As part of the sale-leaseback transaction, Orient Paper HB entered into a Collateral Agreement with CNFTFL and pledged the land use right in the amount of approximately $7,502,794 on some 58,566 square meters of land as collateral for the lease. In addition to Orient Paper HB’s collateral, Orient Paper Shengde also entered into a Guarantee Contract with CNFTFL on June 16, 2013. Under the Guarantee Contract, Orient Paper Shengde agrees to guarantee Orient Paper HB’s performance under the lease and to pledge all of its production equipment as additional collateral. Net book value of Orient Paper Shengde’s asset guarantee was $36,134,038 as of December 31, 2013. | ||||||||
The future minimum lease payments of the capital lease as of December 31, 2013 were as follows: | ||||||||
Year Ending December 31, | Amount | |||||||
2014 | $ | 9,327,690 | ||||||
2015 | 8,817,611 | |||||||
2016 | 4,218,050 | |||||||
$ | 22,363,351 |
Related_Party_Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
(11) Related Party Transactions | |
Mr. Zhenyong Liu is the director, principal stockholder and chief executive officer of the Company. He loaned money to Orient Paper HB for working capital purposes over a period of time. On August 31, 2009, Orient Paper, Orient Paper HB, and Mr. Liu entered into a tri-party Debt Assignment and Assumption Agreement, under which Orient Paper agreed to assume the loan of $4,000,000 due from Orient Paper HB to Mr. Liu. Concurrently, Orient Paper issued 1,204,341 shares of restricted common stock to Mr. Liu at the market price of $3.32132 per share. As of December 31, 2012, net amount due to Mr. Liu was $2,315,239. | |
The unsecured loan of Mr. Liu is interest bearing and the interest rate is equal to the rate established by the People’s Bank of China, which was 5.85% per annum as of December 31, 2012. The term is for 3 years and starts from January 1, 2010 and is due December 31, 2012. On January 1, 2013, Orient Paper HB and Mr. Liu entered into another three-year term and extended the maturity date further to December 31, 2015. The unsecured loan carries an annual interest rate based on the People’s Bank of China at the time of the renewal and was set at 6.15% per annum. As of December 31, 2013, net amount due to Mr. Liu was $2,389,633. | |
The interest expenses incurred for above related party loans are $145,015, $135,377 and $203,914 for the years ended December 31, 2013, 2012 and 2011, respectively. On March 25, 2014, our Chairman and CEO Mr. Zhenyong Liu agreed in writing to permit the Company to continue to postpone the repayment of the accrued interest on his loan to Orient Paper HB until the earliest date on which the Company's quarterly or annual financial statements filed with the SEC show a satisfactory working capital level. The accrued interest owned to Mr. Liu was approximately $566,343 and was recorded as part of the current liabilities as of December 31, 2013. | |
During the years ended December 31, 2013, 2012 and 2011, the Company borrowed $1,390,802, $1,030,097 and $200,000, respectively, from shareholders to pay for various expenses incurred in the U.S. The amount is repayable on demand with interest free. The Company repaid the entire balance by the end of fiscal year 2013, 2012 and 2011, respectively. | |
Sale of Headquarters Compound Real Properties to a Related Party | |
The Company was informed in 2012 that a recent Xushui County urban redevelopment plan mandates that the current site on which our principal executive offices and other production facilities are situated (the “Headquarters Compound”) and neighboring area be reserved for residential use only. It is expected that the Company, like other manufacturers in the affected area, will be required eventually to cease all operations currently conducted on the Headquarters Compound site. In order to comply with this government mandate, the Company intends to initiate the process of relocating its offices and facilities to a new site. To that end, the Company has entered into negotiations concerning the potential sale of this property and all of the buildings and facilities located thereon (the “Potential Sale”) with Hebei Fangsheng Real Estate Development Co. Ltd. (“Hebei Fangsheng”), a real estate development company owned by Mr. Zhenyong Liu, our Chairman and Chief Executive Officer and his family. In November 2012, Hebei Fangsheng provided the Company with a payment of approximately $1,075,606 earnest money deposit payment in connection with the Potential Sale, which would be refunded to Hebei Fangsheng in the event that the parties fail to reach an agreement on the terms of the Potential Sale. The Company recorded the receipt of the earnest money deposit as a security deposit as of December 31, 2012 accordingly. | |
On August 7, 2013 the Company’s Audit Committee and the Board of Directors approved the sale of the land use right of the Headquarters Compound (the “LUR”), the office building and essentially all industrial-use buildings in the Headquarters Compound (the “Industrial Buildings”), and three employee dormitory buildings located within the Headquarters Compound (the “Dormitories”) to Hebei Fangsheng for cash prices of approximately $2.77 million, $1.15 million, and $4.28 million, respectively. In connection with the sale of the Industrial Buildings, Hebei Fangsheng agrees to lease the Industrial Buildings back to the Company for its original use for a term of up to three years, with an annual rental payment of approximately $161,439. As of December 31, 2013, the Company accrued the rent due to Hebei Fangsheng in the amount of $64,546. | |
As a condition for the sale of the Dormitories, Hebei Fangsheng agrees that it will act as an agent for the Company, which does not have the qualification to sell residential housing units in China, and that it is obligated to sell all of the 132 apartment units in the Dormitories to qualified employees of the Company at its acquisition price. Hebei Fangsheng further represents that it will not seek to profit from the resale of the Dormitories units and will allow the Company to inspect the books and records of the sale upon completion of the resale of the Dormitories units to ensure the objectives are achieved. | |
The sale was conducted on an arms-length basis, and was reviewed by the Company’s Audit Committee and approved by the Board of Directors. The $2.77 million sale price of the industrial land use right was determined by the valuation from a government designated appraisal, which was 3.35% higher than a second independent appraisal commissioned by the Company. The $1.15 million sale price of the Industrial Buildings was determined by negotiation between the Company and Hebei Fangsheng and is equal to the appraised value based on the assumption that the use of the buildings would be continued until they are retired. Based on the assumption that such buildings would have to be torn down to comply with the re-zoning, a second independent appraisal obtained by the Company put the value at $0.4 million. Although the Company and Hebei Fangsheng agree to set the sale price of the Dormitories at the Company’s original construction cost of the three dormitory buildings for $4.28 million, an independent appraisal shows that the value for the three buildings as employee dormitories was $4.61 million. | |
For the sale of the Headquarters Compound LUR and the Industrial Buildings, it generated a net gain on disposal of approximately $84,972, net of land appreciation tax and other transactional taxes and fees paid out of the proceeds of the sale to various local government tax authorities. | |
The dormitories were reclassified as assets held for sale on August 9, 2013 in accordance with ASC 360-10-45-9. As the sale was not yet completed by the end of December 31, 2013, the dormitories remained as assets held for sale under current asset in the amount of $4,130,590 as of December 31, 2013. The closing of the sale is expected to be consummated by the second half of year 2014. In December 2013, Hebei Fangsheng provided the Company with a payment of approximately $1,636,072 earnest money deposit payment in connection with the sale of the dormitories. The Company recorded the receipt of the earnest money deposit as a security deposit as of December 31, 2013 accordingly. |
Notes_Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2013 | |
Notes Payable [Abstract] | ' |
Notes payable | ' |
(12) Notes payable | |
As of December 31, 2013, the Company had three bank acceptance notes from Bank of Hebei to one of its major suppliers for a total amount of $4,908,216. An amount equal to $2,454,108 is under the banking facility obtained from Bank of Hebei in November 13, 2013, while the remaining portion, amount of $2,454,108 are secured with a restricted bank deposit as mentioned in Note (3). The banking facility obtained from Bank of Hebei was secured by certain of the Company’s property, plant and equipment in the amount of $34,177, and guaranteed by the Company’s Chairman and CEO Mr. Liu Zhenyong and two independent third parties. The bank acceptance notes bear interest rate at nil% per annum and 0.05% of notes amount as handling change. They will become due and payable on various dates starting from May 15 through June 19 during the year of 2014. | |
As of December 31, 2012, the Company had six bank acceptance notes from Bank of Hebei to one of its major suppliers for a total amount of $3,170,276. An amount equal to $1,585,138 is under the banking facility obtained from Bank of Hebei in September 13, 2012 as mention in Note (10), while the remaining portion, amount of $1,585,138, are secured with a restricted bank deposit as mention in Note (3). The bank acceptance notes bear interest rate at nil% per annum and 0.05% of notes amount as handling charge. They will become due and payable on various dates starting from March 24 through June 18 during the year of 2013. |
Other_Payables_and_Accrued_Lia
Other Payables and Accrued Liabilities | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Other Payables and Accrued Liabilities [Abstract] | ' | ||||||||
Other payables and accrued liabilities | ' | ||||||||
(13) Other payables and accrued liabilities | |||||||||
Other payables and accrued liabilities consist of the following: | |||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Accrued electricity | $ | 372,726 | $ | 232,763 | |||||
Accrued professional fees | 58,000 | 143,597 | |||||||
Value-added tax payable | 940,400 | - | |||||||
Accrued interest to a related party | 566,343 | 406,324 | |||||||
Accrued bank loan interest | 380,022 | 250,299 | |||||||
Payable for purchase of equipment | - | 152,173 | |||||||
Advance from customer | 11,453 | - | |||||||
Insurance premium payable | 62,348 | 56,773 | |||||||
Others | 260,180 | 20,355 | |||||||
Totals | $ | 2,651,472 | $ | 1,262,284 |
Common_Stock
Common Stock | 12 Months Ended |
Dec. 31, 2013 | |
Common Stock [Abstract] | ' |
Common Stock | ' |
(14) Common Stock | |
Issuance of common stock pursuant to the 2011 Incentive Stock Plan and 2012 Incentive Stock Plan | |
On January 12, 2012, the Company issued shares of 109,584 out of the 2011 Incentive Stock Plan of Orient Paper, Inc. (the “2011 ISP”) to certain of its directors and officers when the stock was at $3.45 per share, as compensation for their services in the past years. Total fair value of the stock was calculated at $378,065 as of the date of issuance. The 2011 ISP was approved by the shareholders of the Company in August 2011 and sets aside 375,000 shares of the Company’s common stock for the purpose of compensating services provided by the employees, directors and other service providers. | |
On December 31, 2013, the Company issued restricted common shares of 297,000 out of the 2011 ISP and 2012 Incentive Stock Plan (the “2012 ISP”) of Orient Paper, Inc. to certain of its directors and officers when the stock was at $2.66 per share, as compensation for their services in the past years. Total fair value of the stock was calculated at $790,020 as of the date of grant. See Note (17), Stock Incentive Plan, for more details of the 2011 ISP and the 2012 ISP. | |
Cancellation of certain director compensation shares | |
On April 4, 2013, the Company cancelled 2,875 shares of common stock previously issued on March 31, 2011 to two of its directors. The cancellation of shares was at the request of the New York Stock Exchange following a review of the Company’s shares listing application, where the stock exchange believes the shares were issued without shareholder approval and after the Company was subject to the shareholder approval requirement for any stock compensation. The Company reversed the related capital accounts and 2011 compensation expense of $3 and $16,155, respectively, during the year ended December 31, 2013. | |
Dividend declared | |
On June 1, 2012, the Company’s Board of Directors approved a quarterly cash dividend of $0.0125 per share for each of the coming four quarters. The first quarterly dividend was declared on June 1, 2012 to shareholders of record as of June 15, 2012. The dividends were paid on July 2, 2012. | |
On September 4, 2012, the Company declared another quarterly dividend of $0.0125 per share to shareholders of record as of September 14, 2012. The dividends were paid on October 1, 2012. On December 6, 2012, the Company declared a third quarterly cash dividend of $0.0125 per share to shareholders of record as of December 17, 2012. The dividends were paid on December 31, 2012. Total dividends declared and paid for the year ended December 31, 2012 were $692,242. | |
On April 4, 2013, the Company declared another quarterly dividend of $0.0125 per share to shareholders of record as of April 16, 2013. The dividend was paid on April 30, 2013. | |
On November 21, 2013, the Company declared another quarterly dividend of $0.005 per share to shareholders of record as of November 29, 2013. The dividend was paid on December 10, 2013. Total dividends declared and paid for the year ended December 31, 2013 were $323,032. | |
Future declaration of dividends will depend on, among other things, the Company's results of operations, capital requirements, financial condition and on such other factors as the Company's Board of Directors may in its discretion consider relevant and in the best long term interest of the shareholders. |
Earnings_Per_Share
Earnings Per Share | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||
Earnings Per Share | ' | ||||||||||||
(15) Earnings Per Share | |||||||||||||
For the years ended December 31, 2013, 2012 and 2011, basic and diluted net income per share are calculated as follows: | |||||||||||||
Year Ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Basic income per share | |||||||||||||
Net income for the year - numerator | $ | 13,014,648 | $ | 14,672,663 | $ | 21,648,664 | |||||||
Weighted average common stock outstanding - denominator | 18,458,446 | 18,456,781 | 18,349,332 | ||||||||||
Net income per share | $ | 0.71 | $ | 0.79 | $ | 1.18 | |||||||
Diluted income per share | |||||||||||||
Net income for the year - numerator | $ | 13,014,648 | $ | 14,672,663 | $ | 21,648,664 | |||||||
Weighted average common stock outstanding - denominator | 18,458,446 | 18,456,781 | 18,349,332 | ||||||||||
Effect of dilution | - | - | - | ||||||||||
Weighted average common stock outstanding - denominator | 18,458,446 | 18,456,781 | 18,349,332 | ||||||||||
Diluted income per share | $ | 0.71 | $ | 0.79 | $ | 1.18 |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Taxes [Abstract] | ' | ||||||||||||
Income Taxes | ' | ||||||||||||
(16) Income Taxes | |||||||||||||
United States | |||||||||||||
Orient Paper and Shengde Holdings are incorporated in the State of Nevada and are subject to the U.S. federal tax and state statutory tax rates up to 34% and 0%, respectively. | |||||||||||||
PRC | |||||||||||||
Orient Paper HB and Orient Paper Shengde are PRC operating companies and are subject to PRC Enterprise Income Tax. Pursuant to the PRC New Enterprise Income Tax Law, Enterprise Income Tax is generally imposed at a statutory rate of 25%. | |||||||||||||
The provisions for income taxes for the years ended December 31, 2013, 2012 and 2011 were as follows: | |||||||||||||
Year Ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Provision for Income Taxes | |||||||||||||
Current Tax Provision - PRC | $ | 4,684,870 | $ | 6,406,050 | $ | 7,799,226 | |||||||
Deferred Tax Provision - PRC | 409,665 | -941,207 | - | ||||||||||
Total Provision for Income Taxes | $ | 5,094,535 | $ | 5,464,843 | $ | 7,799,226 | |||||||
In addition to the reversible future PRC income tax benefits stemming from the timing differences of items such as recognition of asset disposal gain or loss and asset depreciation, Orient Paper, Inc. was incorporated in the United States and has incurred aggregate net operating losses of approximately $4,252,220, $3,148,622 and $2,230,753 for U.S. income tax purposes for the years ended December 31, 2013, 2012 and 2011, respectively. The net operating loss carried forward may be available to reduce future years’ taxable income. These carry forwards will expire, if not utilized, during the period of 2028 through 2033. Management believes that the realization of all the U.S. income tax benefits from these losses, which generally would generate a deferred tax asset if it can be expected to be utilized in the future, appears not more than likely due to the Company’s limited operating history and continuing losses for United States income tax purposes. Accordingly, the Company has provided a 100% valuation allowance on the U.S. deferred tax asset benefit to reduce the total deferred tax asset to the amount realizable for the PRC income tax purposes. Management will review this valuation allowance periodically and make adjustments as warranted. A summary of the otherwise deductible (or taxable) deferred tax items is as follows: | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Deferred tax assets (liabilities) – current: | |||||||||||||
Depreciation and amortization of property, plant and equipment | $ | 139,805 | $ | - | |||||||||
Impairment of property, plant and equipment | 225,656 | - | |||||||||||
Miscellaneous | 48,076 | - | |||||||||||
Total deferred tax asset – current, net | $ | 413,537 | $ | - | |||||||||
Deferred tax assets (liabilities) – non-current | |||||||||||||
Depreciation and amortization of property, plant and equipment | $ | 31,446 | $ | 401,482 | |||||||||
Impairment of property, plant and equipment | 261,805 | 690,916 | |||||||||||
Miscellaneous | (24,922 | ) | (150,742 | ) | |||||||||
Net Operating Loss Carryover for U.S. income tax purposes | 1,445,755 | 2,303,851 | |||||||||||
Total deferred tax assets – non-current | 1,714,084 | 3,245,507 | |||||||||||
Less: Valuation allowance | (1,445,755 | ) | (2,303,851 | ) | |||||||||
Total deferred tax assets – non-current, net | $ | 268,329 | $ | 941,656 | |||||||||
The following table reconciles the statutory rates to the Company's effective tax rate as of: | |||||||||||||
Year ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
PRC Statutory rate | 25 | % | 25 | % | 25 | % | |||||||
Effect of different tax jurisdiction | (1.1 | ) | (0.6 | ) | (0.6 | ) | |||||||
Effect of expenses not deductible for PRC tax purposes | 1.5 | - | 0.1 | ||||||||||
Effect of income not taxable for PRC tax purposes | - | 0.3 | (0.3 | ) | |||||||||
Under provision in previous year | - | - | 0.1 | ||||||||||
Change in valuation allowance | 2.7 | 2.4 | 2.2 | ||||||||||
Effective income tax rate | 28.1 | % | 27.1 | % | 26.5 | % | |||||||
For U.S. tax purposes, the Company has cumulative undistributed earnings of foreign subsidiaries of approximately $100,959,070 and $86,287,945 as of December 31, 2013 and 2012, respectively, which are included in consolidated retained earnings and will continue to be indefinitely reinvested in international operations. Accordingly, no provision has been made for U.S. deferred taxes related to future repatriation of these earnings, nor is it practicable to estimate the amount of income taxes that would have to be provided if we concluded that such earnings will be remitted to the U.S. in the future. | |||||||||||||
On April 4, 2013, the Company declared quarterly dividend of $0.0125 per share to shareholders of record as of April 16, 2013. On November 21, 2013, the Company’s Board of Directors approved a quarterly cash dividend of $0.005/share for four quarters starting the first record dare of November 29, 2013. Total cash dividends for the four quarters are expected to be approximately $373,593 based on the total shares issued and outstanding as of December 31, 2013. | |||||||||||||
The source of fund for the two cash dividend paid by the Company as of December 31, 2013 was provided by Orient Paper HB, the Company’s VIE. For purposes of the consolidated financial statements, the dividend paid has been recorded as a distribution from the Company’s retained earnings. For U.S federal income tax purposes, the Company made the assumption that, despite the repatriation of fund was made by a variable interest entity and not the Company’s wholly-owned subsidiary, the receipt of a profit distribution from its Chinese VIE constitute a tax item of income that will be fully offset by the Company’s current year ordinary tax deductions and accumulated Net Operating Losses (NOLs), which amounted to approximately $4,252,220 before any utilization of such NOLs to absorb taxable income derived from the dividend distribution as of December 31, 2013. The Company does not believe that its current and future dividend policy and the available U.S. tax deductions and NOLs will cause the Company to recognize any substantial current U.S. federal or state corporate income tax liability in the near future. Nor does it believes that the amount of the repatriation of the VIE’s earnings and profits for purposes of paying dividends will change the Company’s position that its PRC subsidiary Orient Paper Shengde and the VIE, Orient Paper HB are considered or are expected to be indefinitely reinvested offshore to support our future capacity expansion. If these earnings are repatriated to the U.S. resulting in U.S. taxable income in the future, or if it is determined that such earnings are to be remitted in the foreseeable future, additional tax provisions would be required. | |||||||||||||
The Company has adopted ASC Topic 740-10-05, Income Taxes. To date, the adoption of this interpretation has not impacted the Company’s financial position, results of operations, or cash flows. The Company performed self-assessment and the Company’s liability for income taxes includes the liability for unrecognized tax benefits, interest and penalties which relate to tax years still subject to review by taxing authorities. Audit periods remain open for review until the statute of limitations has passed, which in the PRC is usually 5 years. The completion of review or the expiration of the statute of limitations for a given audit period could result in an adjustment to the Company’s liability for income taxes. Any such adjustment could be material to the Company’s results of operations for any given quarterly or annual period based, in part, upon the results of operations for the given period. As of December 31, 2013 and 2012, management considered that the Company had no uncertain tax positions affecting its consolidated financial position and results of operations or cash flows, and will continue to evaluate for any uncertain position in future. There are no estimated interest costs and penalties provided in the Company’s consolidated financial statements for the years ended December 31, 2013, 2012 and 2011, respectively. The Company’s tax positions related to open tax years are subject to examination by the relevant tax authorities and the major one is the China Tax Authority. |
Stock_Incentive_Plans
Stock Incentive Plans | 12 Months Ended |
Dec. 31, 2013 | |
Stock Incentive Plans [Abstract] | ' |
Stock Incentive Plans | ' |
(17) Stock Incentive Plans | |
On August 28, 2011, the Company’s Annual General Meeting approved the 2011 ISP as previously adopted by the Board of Directors on July 5, 2011. Under the 2011 ISP, the Company may grant an aggregate of 375,000 shares of the Company’s common stock to the Company’s directors, officers, employees or consultants. No stock or option was issued under the 2011 ISP until January 11, 2012, when the Compensation Committee granted 109,584 shares of restricted common stock to certain officers and directors of the Company. On December 31, 2013, the Compensation Committee granted remaining 265,416 shares of restricted common stock under the 2011 ISP to certain officers and directors of the Company. | |
On September 10, 2012, the Company’s Annual General Meeting approved the 2012 ISP. Under the 2012 ISP, the Company may grant an aggregate of 200,000 shares of the Company’s common stock to the Company’s directors, officers, employees or consultants. Specifically, the Board and/or the Compensation Committee have authority to (a) grant, in its discretion, Incentive Stock Options or Non-statutory Options, Stock Awards or Restricted Stock Purchase Offers; (b) determine in good faith the fair market value of the stock covered by any grant; (c) determine which eligible persons shall receive grants and the number of shares, restrictions, terms and conditions to be included in such grants; and (d) make all other determinations necessary or advisable for the 2012 ISP's administration. On December 31, 2013, the Compensation Committee granted 31,584 shares of restricted common stock under the 2012 ISP to certain officers and directors of the Company. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Commitments and Contingencies [Abstract] | ' | ||||
Commitments and Contingencies | ' | ||||
(18) Commitments and Contingencies | |||||
Operating Lease | |||||
Orient Paper leases 32.95 acres of land from a local government in Xushui County, Baoding City, Hebei, China through a real estate lease with a 30-year term, which expires on December 31, 2031. The lease requires an annual rental payment of approximately $19,633 (RMB 120,000). This operating lease is renewable at the end of the 30-year term. | |||||
On November 27, 2012, Orient Paper entered into a 49.4 acres land lease with an investment company in the Economic Development Zone in Wei County, Hebei, China. The lease term of the Wei County land lease commences on the date of the lease and lasts for 15 years. The lease requires an annual rental payment of $588,986 (RMB 3,600,000). The Company will be building two new tissue paper production lines and future production facilities in the leased Wei County land. | |||||
As mentioned in Note (11) Related Party Transactions, in connection with the sale of Industrial Buildings to Hebei Fangsheng, Hebei Fangsheng agrees to lease the Industrial Buildings back to Orient Paper at an annual rental of $163,607 (RMB 1,000,000), for a term of up to three years. The Company will continue its operations in the current location for a maximum of three years while looking for a new location to relocate its offices and the digital photo paper operations currently located in the headquarters compound. | |||||
Future minimum lease payments of all operating leases are as follows: | |||||
Year Ending December 31, | Amount | ||||
2014 | $ | 707,680 | |||
2015 | 772,226 | ||||
2016 | 772,226 | ||||
2017 | 608,619 | ||||
2018 | 608,619 | ||||
Thereafter | 4,967,114 | ||||
$ | 8,436,484 | ||||
Capital commitment | |||||
As of December 31, 2013, the Company has signed several contracts for construction of equipment and facilities, including a new tissue paper production line PM8. Total outstanding commitments under these contracts were $51,673,158 and $5,243,636 as of December 31, 2013 and December 31, 2012, respectively. With the exception of a 5%-10% performance holdback on the construction of equipment and facilities is payable in 2014 and 2015, the Company expected to pay off all the balances by the end of year 2014. | |||||
Pending Litigation | |||||
On August 6, 2010, a stockholder class action lawsuit was filed in the U.S. District Court for the Central District of California against the Company, certain current and former officers and directors of the Company, and Roth Capital Partners, LLP. The complaint in the lawsuit, Mark Henning, et al. v. Orient Paper et al., CV-10-5887 RSWL (AJWx), alleges, among other claims, that the Company issued materially false and misleading statements and omitted to state material facts that rendered its affirmative statements misleading as they related to the Company’s financial performance, business prospects, and financial condition, and that the defendants failed to prevent such statements from being issued or corrected. The complaint seeks, among other relief, compensatory damages, attorneys' fees and experts’ fees. Plaintiffs purport to sue on behalf of themselves and a class consisting of the Company’s stockholders (other than the defendants and their affiliates). The plaintiffs filed an amended complaint on January 28, 2011, and the Company filed a motion to dismiss with the court on March 14, 2011. On July 20, 2011 the court denied the Company’s motion to dismiss, thus allowing the litigation to proceed to discovery. On June 21, 2012, the Company reached a proposed settlement of the securities class action lawsuit with the plaintiffs. The terms of the proposed settlement call for dismissal of all the defendants from the action in exchange for a $2 million payment from the Company’s insurer. The court granted preliminary approval of the settlement on November 5, 2012, and orally granted final settlement approval at a hearing on March 25, 2013. A formal written order has been entered by the Court on April 29, 2013. The settlement had no material impact on the Company’s consolidated financial statements. | |||||
On April 1, 2011 the Company was served a summon for a complaint filed by Tribank Capital Investments, Inc. (“Tribank”) on March 30, 2011 in the Superior Court of the State of California for the County of Los Angeles against the Company and its Chairman and CEO Mr. Zhenyong Liu (the “Tribank Matter”). By filing the complaint, Tribank alleges, among other claims, that the Company breached the Non-Circumvention Agreement dated October 29, 2008 between the Company and Tribank (the “Agreement”), and that the Company was unjustly enriched as a result of breaching the Agreement. The complaint seeks, among other relief, compensatory damages and plaintiff’s counsel’s fees. On April 29, 2011 the Company filed a Notice of Removal to remove the jurisdiction of the case from the state court of California to the Federal District Court for the District of Central California and filed a motion to dismiss the lawsuit on May 6, 2011. On July 18, 2011, United States District Court Judge Manual Real granted Orient Paper motion to dismiss the complaint in its entirety, finding that venue is improper because the contract that forms the basis of the parties' relationship contains a valid and enforceable forum selection clause providing that the Hong Kong Special Administrative Region of China is the exclusive forum for resolution of disputes. Tribank subsequently filed a notice of appeal with the court on August 5, 2011 and did file an opening brief with the U.S. Court of Appeals for the Ninth Circuit, to which the Company filed an answering brief on August 31, 2012. Oral argument took place on April 9, 2013. Shortly thereafter, the Ninth Circuit entered a memorandum reversing the District Court’s dismissal because the record was not sufficiently developed to make a determination as to whether the forum selection clause applied, and remanding the case back to the District Court with instructions to hold an evidentiary hearing before ruling on the Company’s motion to dismiss. The evidentiary hearing was held on August 12, 2013. Subsequent to the hearing, the District Court ordered to dismiss the case in its entirety for the same reasons on August 14, 2013. The appeal period for Tribank has expired. | |||||
Cross-Guarantee with a Third Party | |||||
As of December 31, 2012, the Company used land use right in the amount of $7,419,614 as a pledge for a bank loan of an independent third party, which cross-guarantees the Company’s credit facility of $1,585,138 from the Bank of Hebei. That long-term loan of the third party had been paid off on June 3, 2013, while the credit facility guaranteed by the independent third party expired on September 19, 2013. |
Segment_Reporting
Segment Reporting | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||||||
Segment Reporting | ' | |||||||||||||||||||
(19) Segment Reporting | ||||||||||||||||||||
Since March 10, 2010, Orient Paper Shengde started its operations and thereafter the Company manages its operations through two business operating segments: Orient Paper HB, which produces printing paper and corrugating medium paper, and Orient Paper Shengde, which produces digital photo paper. They are managed separately because each business requires different technology and marketing strategies. | ||||||||||||||||||||
The Company evaluates performance of its operating segments based on net income. Administrative functions such as finance, treasury, and information systems are centralized. However, where applicable, portions of the administrative function expenses are allocated between the operating segments based on gross revenue generated. The operating segments do share facilities in Xushui County, Baoding City, Hebei, China. All sales were sold to customers located in the PRC. | ||||||||||||||||||||
Summarized financial information for the two reportable segments is as follows: | ||||||||||||||||||||
Year Ended | ||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||
Orient Paper | Orient Paper | Not Attributable | Elimination | Enterprise-wide, | ||||||||||||||||
HB | Shengde | to Segments | of Inter-segment | consolidated | ||||||||||||||||
Revenues | $ | 120,747,633 | $ | 4,969,997 | $ | - | $ | - | $ | 125,717,630 | ||||||||||
Gross Profit | 22,318,739 | 1,006,860 | - | - | 23,325,599 | |||||||||||||||
Depreciation and amortization | 6,828,970 | 965,773 | - | - | 7,794,743 | |||||||||||||||
Interest income | 86,168 | 4,009 | 83 | - | 90,260 | |||||||||||||||
Interest expense | 995,694 | - | - | - | 995,694 | |||||||||||||||
Income tax expense | 4,845,970 | 248,565 | - | - | 5,094,535 | |||||||||||||||
Net Income (Loss) | 14,604,244 | 638,031 | (2,227,627 | ) | - | 13,014,648 | ||||||||||||||
Total Assets | 168,149,877 | 41,264,704 | 111,621 | - | 209,526,202 | |||||||||||||||
Year Ended | ||||||||||||||||||||
31-Dec-12 | ||||||||||||||||||||
Orient Paper | Orient Paper | Not Attributable | Elimination | Enterprise-wide, | ||||||||||||||||
HB | Shengde | to Segments | of Inter-segment | consolidated | ||||||||||||||||
Revenues | $ | 144,928,792 | $ | 6,188,014 | $ | - | $ | - | $ | 151,116,806 | ||||||||||
Gross Profit | 25,616,670 | 1,439,577 | - | - | 27,056,247 | |||||||||||||||
Depreciation and amortization | 6,553,120 | 1,829,739 | - | - | 8,382,859 | |||||||||||||||
Impairment | 2,762,349 | - | - | - | 2,762,349 | |||||||||||||||
Interest income | 25,950 | 4,634 | 90 | - | 30,674 | |||||||||||||||
Interest expense | 867,561 | - | 4,273 | - | 871,834 | |||||||||||||||
Income tax expense | 5,129,304 | 335,539 | - | - | 5,464,843 | |||||||||||||||
Net Income (Loss) | 15,109,345 | 965,444 | (1,402,126 | ) | - | 14,672,663 | ||||||||||||||
Total Assets | 119,707,195 | 43,076,428 | 62,701 | - | 162,846,324 | |||||||||||||||
Year Ended | ||||||||||||||||||||
December 31, 2011 | ||||||||||||||||||||
Orient Paper | Orient Paper | Not Attributable | Elimination | Enterprise-wide, | ||||||||||||||||
HB | Shengde | to Segments | of Inter-segment | consolidated | ||||||||||||||||
Revenues | $ | 142,498,116 | $ | 8,249,200 | $ | - | $ | - | $ | 150,747,316 | ||||||||||
Gross Profit | 30,191,480 | 2,758,595 | - | - | 32,950,075 | |||||||||||||||
Depreciation and amortization | 3,504,717 | 919,814 | - | - | 4,424,531 | |||||||||||||||
Interest income | 20,847 | 15,273 | 317 | - | 36,437 | |||||||||||||||
Interest expense | 699,892 | - | - | - | 699,892 | |||||||||||||||
Income tax expense | 7,136,886 | 662,340 | - | - | 7,799,226 | |||||||||||||||
Net Income (Loss) | 21,527,824 | 1,961,694 | (1,840,854 | ) | - | 21,648,664 |
Concentration_and_Major_Custom
Concentration and Major Customers and Suppliers | 12 Months Ended |
Dec. 31, 2013 | |
Concentration of Major Customers and Suppliers and Concentration of Credit Risk [Abstract] | ' |
Concentration and Major Customers and Suppliers | ' |
(20) Concentration and Major Customers and Suppliers | |
For the years ended December 31, 2013, 2012 and 2011, the Company had no single customer contributed over 10% of total sales. For the year ended December 31, 2013, the Company had three major suppliers accounted for 75%, 10% and 7% of total purchases. For the year ended December 31, 2012, the Company had two major suppliers accounted for 77% and 8% of total purchases. For the year ended December 31, 2011, the Company had three major suppliers which primarily accounted for 61%, 11% and 6% of total purchases. |
Concentration_of_Credit_Risk
Concentration of Credit Risk | 12 Months Ended |
Dec. 31, 2013 | |
Concentration of Major Customers and Suppliers and Concentration of Credit Risk [Abstract] | ' |
Concentration of Credit Risk | ' |
(21) Concentration of Credit Risk | |
Financial instruments for which the Company is potentially subject to concentration of credit risk consist principally of cash. The Company places its temporary cash investments in reputable financial institutions in the PRC and the United States. Although it is generally understood that the PRC central government stands behind all of the banks in China in the event of bank failure, there is no deposit insurance system in China that is similar to the protection provided by the Federal Deposit Insurance Corporation (FDIC) of the United States. The Company’s U.S. bank accounts are all fully covered by the FDIC insurance as of December 31, 2013 and 2012, respectively. |
Risks_and_Uncertainties
Risks and Uncertainties | 12 Months Ended |
Dec. 31, 2013 | |
Concentration of Major Customers and Suppliers and Concentration of Credit Risk [Abstract] | ' |
Risks and Uncertainties | ' |
(22) Risks and Uncertainties | |
Orient Paper is subject to substantial risks from, among other things, intense competition associated with the industry in general, other risks associated with financing, liquidity requirements, rapidly changing customer requirements, foreign currency exchange rates, and operating in the PRC under its various laws and restrictions. |
Recent_Accounting_Pronouncemen
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2013 | |
Recent Accounting Pronouncements [Abstract] | ' |
Recent Accounting Pronouncements | ' |
(23) Recent Accounting Pronouncements | |
In July 2013, the FASB issued ASU 2013-11, Income Tax (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. The ASU provides guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. An unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The amendments in this Update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Its adoption of ASU2013-11 is not expected to have any material impact on the Company's consolidated financial statements. |
Subsequent_Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2013 | |
Subsequent Events [Abstract] | ' |
Subsequent Event | ' |
(24) Subsequent Event | |
On March 3, 2014, Orient Paper entered into a Revolving Line of Credit Agreement with Shanghai Pudong Development Bank (“SPD Bank”) for a total credit facility in the amount of approximately $3.3 million. Pursuant to the credit facility, the Company may draw six-month bank acceptance notes for up to approximately $3.3 million for making supplier payments. The facility has a term for the period of March 3, 2014 through January 12, 2015 and is collateralized by certain land use rights provided by Hebei Fangsheng Real Estate Development Co. Ltd., a related party controlled by our Chairman and CEO Mr. Zhenyong Liu. | |
On March 21, 2014 the provincial branch of the Industrial & Commercial Bank of China (“ICBC”) approved a new maximum total banking credit facility for Orient Paper HB for approximately $24.5 million in the year of 2014. We had already had various working capital loans for a total of $6.5 million from ICBC as of December 31, 2013, which means that we may be able to draw additional financing under the maximum ICBC facility for up to $18 million. |
Summarized_Quarterly_Financial
Summarized Quarterly Financial Data (Unaudited) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Summarized Quarterly Financial Data [Abstract] | ' | ||||||||||||||||
Summarized Quarterly Financial Data (Unaudited) | ' | ||||||||||||||||
(25) Summarized Quarterly Financial Data (Unaudited) | |||||||||||||||||
Quarterly financial information for 2013 and 2012 is as follows: | |||||||||||||||||
Quarter | |||||||||||||||||
2013 | First | Second | Third | Fourth | |||||||||||||
Revenues | $ | 19,746,656 | 33,038,512 | 37,686,114 | 35,246,348 | ||||||||||||
Gross Profit | 1,630,237 | 6,098,395 | 8,435,814 | 7,161,153 | |||||||||||||
Income from Operations | 743,071 | 5,211,839 | 7,563,522 | 5,325,060 | |||||||||||||
Net income | 303,055 | 3,656,136 | 5,534,844 | 3,520,613 | |||||||||||||
Net income per share: | |||||||||||||||||
Basic | $ | 0.02 | 0.02 | 0.3 | 0.19 | ||||||||||||
Diluted | $ | 0.02 | 0.02 | 0.3 | 0.19 | ||||||||||||
Quarter | |||||||||||||||||
2012 | First | Second | Third | Fourth | |||||||||||||
Revenues | $ | 34,408,999 | $ | 35,521,672 | $ | 37,651,354 | $ | 43,534,781 | |||||||||
Gross Profit | 7,753,172 | 5,785,664 | 6,820,053 | 6,697,358 | |||||||||||||
Income from Operations | 6,708,500 | 5,099,534 | 6,161,418 | 3,009,214 | |||||||||||||
Net income | 4,681,691 | 3,610,790 | 4,379,071 | 2,001,111 | |||||||||||||
Net income per share: | |||||||||||||||||
Basic | $ | 0.25 | $ | 0.2 | $ | 0.24 | $ | 0.11 | |||||||||
Diluted | $ | 0.25 | $ | 0.2 | $ | 0.24 | $ | 0.11 |
Condensed_Financial_Informatio
Condensed Financial Information of the Parent Company | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Condensed Financial Information of Parent Company [Abstract] | ' | ||||||||||||
Condensed Financial Information of the Parent Company | ' | ||||||||||||
(25) Condensed Financial Information of the Parent Company | |||||||||||||
The condensed financial statements of Orient Paper Inc. (“ONP”, the “parent company”) have been prepared in accordance with accounting principles generally accepted in the United States of America. Under the PRC laws and regulations, the Company’s PRC subsidiaries are restricted in their ability to transfer certain of their net assets to the parent company in the form of dividend payments, loans or advances. The amounts restricted include paid-in capital, capital surplus and statutory reserves, as determined pursuant to PRC generally accepted accounting principles, totaling $52,666,026 and $50,953,325 as of December 31, 2013 and 2012, respectively. | |||||||||||||
The following represents condensed unconsolidated financial information of the parent company only: | |||||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||
December 31, | December 31, | ||||||||||||
2013 | 2012 | ||||||||||||
ASSETS | |||||||||||||
Current Assets | |||||||||||||
Cash and cash equivalents | $ | 42,592 | $ | - | |||||||||
Prepayments and other current assets | 69,029 | 62,797 | |||||||||||
Total current assets | 111,621 | 62,797 | |||||||||||
Investment in subsidiaries | 163,658,397 | 143,597,251 | |||||||||||
Total Assets | $ | 163,770,018 | $ | 143,660,048 | |||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||||
Current Liabilities | |||||||||||||
Bank overdraft | $ | - | $ | 96 | |||||||||
Inter-company payable | 2,544,855 | 736,378 | |||||||||||
Accrued payroll and employee benefit | 51,667 | 40,000 | |||||||||||
Accrued liabilities | 58,000 | 58,000 | |||||||||||
Insurance premium payable | 62,348 | 56,773 | |||||||||||
Total current liabilities | 2,716,870 | 891,247 | |||||||||||
Total liabilities | 2,716,870 | 891,247 | |||||||||||
Total stockholders' equity | 161,053,148 | 142,768,801 | |||||||||||
Total Liabilities and Stockholders' Equity | $ | 163,770,018 | $ | 143,660,048 | |||||||||
CONDENSED STATEMENTS OF INCOME | |||||||||||||
Year Ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Operating expenses | |||||||||||||
Selling, general and administrative expenses | $ | 2,227,711 | $ | 1,397,943 | $ | 1,841,171 | |||||||
Loss from Operations | (2,227,711 | ) | (1,397,943 | ) | (1,841,171 | ) | |||||||
Equity in earnings of unconsolidated subsidiaries | 15,242,276 | 16,074,789 | 23,489,518 | ||||||||||
Other Income (Expense) | 83 | (4,183 | ) | 317 | |||||||||
Income before Income Taxes | 13,014,648 | 14,672,663 | 21,648,664 | ||||||||||
Provision for Income Taxes | - | - | - | ||||||||||
Net Income | $ | 13,014,648 | $ | 14,672,663 | $ | 21,648,664 | |||||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||||||||||
Year Ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Net Cash Provided by (Used in) Operating Activities | $ | 365,720 | $ | 546,760 | $ | 75,537 | |||||||
Net Cash Used in Investing Activities | - | - | - | ||||||||||
Net Cash Used in Financing Activities | (323,032 | ) | (692,242 | ) | - | ||||||||
Net Increase (Decrease) in Cash and Cash Equivalents | 42,688 | (145,482 | ) | 75,537 | |||||||||
Cash and Cash Equivalents - Beginning of Period | (96 | ) | 145,386 | 69,849 | |||||||||
Cash and Cash Equivalents - End of Period | $ | 42,592 | $ | (96 | ) | $ | 145,386 | ||||||
BASIS OF PRESENTATION | |||||||||||||
The condensed financial information has been prepared using the same accounting policies as set out in the Company’s consolidated financial statements except that the parent company has used equity method to account for its investments in the subsidiaries. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Significant Accounting Policies [Abstract] | ' | ||||||||
Basis of Consolidation | ' | ||||||||
Basis of Consolidation | |||||||||
The consolidated financial statements of the Company are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”), and include the assets, liabilities, revenues, expenses and cash flows of all subsidiaries and variable interest entity. All significant inter-company balances, transactions and cash flows are eliminated on consolidation. | |||||||||
Foreign Currency Translation | ' | ||||||||
Foreign Currency Translation | |||||||||
The Company accounts for foreign currency translation pursuant to ASC Topic 830, Foreign Currency Matters. The functional currency of Orient Paper HB and Orient Paper Shengde is the Chinese Yuan Renminbi (“RMB”). Monetary assets and liabilities denominated in currencies other than RMB are translated into RMB at the rates of exchange ruling at the balance sheet date. Transactions in currencies other than RMB are converted into RMB at the applicable rates of exchange prevailing the transactions occurred. Transaction gains and losses are recognized in the consolidated statements of income. The functional currency of Orient Paper, Dongfang Holding and Shengde Holdings is United States dollars. Monetary assets and liabilities denominated in currencies other than United States dollars are translated into United States dollars at the rates of exchange ruling at the balance sheet date. Translation in currencies other than United States dollars are converted into United States dollars at the applicable rates of exchange prevailing when the transactions occurred. Transaction gains or losses are recognized in the consolidated statement of income. | |||||||||
Under ASC Topic 830-30, all assets and liabilities are translated into United States dollars using the current exchange rate at the end of each fiscal period. The current exchange rates used by the Company as of December 31, 2013 and 2012 to translate the Chinese RMB to the U.S. Dollars are 6.11220:1, and 6.30860:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.19430:1, 6.31160:1 and 6.45440:1 for the years ended December 31, 2013, 2012 and 2011, respectively. Translation adjustments are included in other comprehensive income (loss). | |||||||||
Use of Estimates | ' | ||||||||
Use of Estimates | |||||||||
The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of December 31, 2013 and 2012, and revenues and expenses for the years ended December 31, 2013, 2012 and 2011. The most significant estimates relate to allowance for uncollectible accounts receivable, inventory valuation, useful lives and impairment for property, plant and equipment, valuation allowance for deferred tax assets and contingencies. Actual results could differ from those estimates made by management. | |||||||||
Cash and Cash Equivalents | ' | ||||||||
Cash and Cash Equivalents | |||||||||
For purposes of reporting within the statements of cash flows, Orient Paper considers all cash on hand, cash accounts not subject to withdrawal restrictions or penalties, and all highly liquid debt instruments purchased with a maturity of three months or less to be cash and cash equivalents. | |||||||||
Accounts Receivable | ' | ||||||||
Accounts Receivable | |||||||||
Trade accounts receivable are recorded on shipment of products to customers. The trade receivables are all without customer collateral and interest is not accrued on past due accounts. Periodically, management reviews the adequacy of its provision for doubtful accounts based on historical bad debt expense results and current economic conditions using factors based on the aging of its accounts receivable. Additionally, the Company may identify additional allowance requirements based on indications that a specific customer may be experiencing financial difficulties. Actual bad debt results could differ materially from these estimates. As of December 31, 2013 and 2012, the balance of allowance for doubtful accounts was $67,592 and $57,643, respectively; and the movement of the provision of the doubtful accounts is as below. While management uses the best information available upon which to base estimates, future adjustments to the allowance may be necessary if economic conditions differ substantially from the assumptions used for the purposes of analysis. | |||||||||
December 31, | December 31, | ||||||||
Allowance of doubtful accounts | 2013 | 2012 | |||||||
Opening balance | $ | 57,643 | $ | 76,752 | |||||
Provision (Reversal of provision) for the year | 7,990 | (19,631 | ) | ||||||
Exchange difference | 1,959 | 522 | |||||||
Closing balance | $ | 67,592 | $ | 57,643 | |||||
Inventories | ' | ||||||||
Inventories | |||||||||
Inventories consist principally of raw materials and finished goods, and are stated at the lower of cost (average cost method) or market. Cost includes labor, raw materials, and allocated overhead. No provision in inventories has been provided for the fiscal years 2013, 2012 and 2011. | |||||||||
Property, Plant, and Equipment | ' | ||||||||
Property, Plant, and Equipment | |||||||||
Property, plant, and equipment are stated at cost less accumulated depreciation and any impairment losses. Major renewals, betterments, and improvements are capitalized to the asset accounts while replacements, maintenance, and repairs, which do not improve or extend the lives of the respective assets, are expensed to operations. At the time property, plant, and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation or amortization accounts are relieved of the applicable amounts. Gains or losses from retirements or sales are credited or charged to operations. | |||||||||
Construction-in-progress is stated at cost and capitalized as expenses are incurred or as payments are made pursuant to relevant construction contracts. Contract retention is recorded as accrued liability. Construction in progress is not depreciated until project completion and the constructed property being placed in service, at which time the capitalized balance will be transferred to appropriate account of property, plant and equipment. | |||||||||
The Company depreciates property, plant, and equipment using the straight-line method as follows: | |||||||||
Land use right | Over the lease term | ||||||||
Building and improvements | 30 years | ||||||||
Machinery and equipment | 5-15 years | ||||||||
Vehicles | 15 years | ||||||||
Valuation of long-lived asset | ' | ||||||||
Valuation of long-lived asset | |||||||||
The Company reviews the carrying value of long-lived assets to be held and used when events and circumstances warrants such a review. The carrying value of a long-lived asset is considered impaired when the anticipated undiscounted cash flow from such asset is separately identifiable and is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair market value of the long-lived asset and intangible assets. Fair market value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. Losses on long-lived assets and intangible assets to be disposed are determined in a similar manner, except that fair market values are reduced for the cost to dispose. | |||||||||
Assets held for sale | ' | ||||||||
Assets held for sale | |||||||||
When assets are identified by management as held for sale, the Company discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets. If, in management's opinion, the estimated net sales price of the assets which have been identified as held for sale is less than the net book value of the assets, a valuation allowance is established. Properties identified as held for sale and/or disposed of are presented as Assets held for sale for all periods presented. | |||||||||
If circumstances arise that previously were considered unlikely and, as a result, the Company decides not to sell a property previously classified as held for sale, the property is reclassified as held and used. A property that is reclassified is measured and recorded individually at the lower of (a) its carrying amount before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell. | |||||||||
Fair Value of Financial Instruments | ' | ||||||||
Fair Value of Financial Instruments | |||||||||
The Company estimates the fair value of financial instruments using the available market information and valuation methods. Considerable judgment is required in estimating fair value. Accordingly, the estimates of fair value may not be indicative of the amounts that the Company could realize in a current market exchange. As of December 31, 2013 and 2012, the carrying value of the Company’s short term financial instruments, such as cash and cash equivalents, accounts receivable, accounts and notes payable, and balance due to a related party, approximate at their fair values because of the short maturity of these instruments; while bank loans, loan from a related party and obligation under capital lease approximate at their fair value as the interest rates thereon are close to the market rates of interest published by the People’s Bank of China. | |||||||||
Statutory Reserves | ' | ||||||||
Statutory Reserves | |||||||||
According to the laws and regulations in the PRC, the Company is required to provide for certain statutory funds, namely, reserve fund by an appropriation from net profit after taxation but before dividend distribution based on the local statutory financial statements of the PRC subsidiary and variable interest entity prepared in accordance with the PRC accounting principles and relevant financial regulations. | |||||||||
The Company’s wholly owned subsidiary and variable interest entity in the PRC are required to allocate at least 10% of its net profit to the reserve fund until the balance of such fund has reached 50% of its registered capital. Appropriations of additional reserve fund are determined at the discretion of its directors. The reserve fund can only be used, upon approval by the relevant authority, to offset accumulated losses or increase capital. | |||||||||
For the years ended December 31, 2013, 2012 and 2011, Orient Paper made transfers to this reserve fund in the amounts of $74,446, $100,518, and $201,855, respectively. For the years ended December 31, 2013, 2012 and 2011, all transfers to statutory reserves were made by Orient Paper Shengde. The Company’s variable interest entity Orient Paper HB, which statutory reserve account has been fully funded for 50% of its registered capital in the amount of RMB 75,030,000 (or approximately $11,811,470) as of December 31, 2010, did not make any transfer to statutory reserves during the years ended December 31, 2013, 2012 and 2011. | |||||||||
Employee Benefit Plan | ' | ||||||||
Employee Benefit Plan | |||||||||
Full time employees of the PRC entities participate in a government mandated multi-employer defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance and other welfare benefits are provided to employees. The total provision for such employee benefits was $nil, $nil and $nil for the years ended December 31, 2013, 2012 and 2011. | |||||||||
Revenue Recognition Policy | ' | ||||||||
Revenue Recognition Policy | |||||||||
The Company recognizes revenue when goods are delivered, when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist, and collectability is reasonably assured. Goods are considered delivered when customer’s truck picks up goods at our finished goods inventory warehouse. | |||||||||
Shipping Cost | ' | ||||||||
Shipping Cost | |||||||||
Substantially all customers use their own trucks or hire commercial trucking companies to pick up goods from the Company. The Company usually incurs no shipping cost for delivery of goods to customers. For those rare situations where products are not shipped utilizing customer specified shipping services, the Company charges customers a shipping fee which is included in net revenues and was not material. Freight-in and handling costs incurred by the Company with respect to purchased goods are recorded as a component of inventory cost and charged to cost of sales when the inventory items are sold. | |||||||||
Advertising | ' | ||||||||
Advertising | |||||||||
The Company expenses all advertising and promotion costs as incurred. The Company incurred $5,085, $10,478 and $6,818 of advertising and promotion costs for the years ended December 31, 2013, 2012 and 2011, respectively. | |||||||||
Research and development costs | ' | ||||||||
Research and development costs | |||||||||
Research and development costs are expensed as incurred and included in selling, general and administrative expenses. Research and development expenses incurred $25,125, $21,636 and $19,756 for the years ended December 31, 2013, 2012 and 2011, respectively. | |||||||||
Borrowing costs | ' | ||||||||
Borrowing costs | |||||||||
Borrowing costs attributable directly to the acquisition, construction or production of qualifying assets which require a substantial period of time to be ready for their intended use or sale, are capitalized as part of the cost of those assets. Income earned on temporary investments of specific borrowings pending their expenditure on those assets is deducted from borrowing costs capitalized. All other borrowing costs are recognized in interest expenses in the period in which they are incurred. | |||||||||
Government subsidies | ' | ||||||||
Government subsidies | |||||||||
A government subsidy is not recognized until there is reasonable assurance that: (a) the enterprise will comply with the conditions attached to the grant; and (b) the grant will be received. When the Company received the government subsidies but the conditions attached to the grants have not been fulfilled, such government subsidies are deferred and recorded under other payables and accrued expenses, and other long-term liability. The reclassification of short-term or long-term liabilities is depended on the management's expectation of when the conditions attached to the grant can be fulfilled. For the years ended December 31, 2013, 2012 and 2011, the Company received government subsidies of $171,125, $nil and $nil, which are recognized as subsidy income in the statements of income in that fiscal year. | |||||||||
Lease Obligations | ' | ||||||||
Lease Obligations | |||||||||
All non-cancellable leases with an initial term greater than one year are categorized as either capital or operating leases. For the lessee, a lease is a capital lease if any of the following conditions exist: a) ownership is transferred to the lessee by the end of the lease term, b) there is a bargain purchase option, c) the lease term is at least 75% of the property’s estimated remaining economic life or d) the present value of the minimum lease payments at the beginning of the lease term is 90% or more of the fair value of the leased property to the lessor at the inception date. A capital lease is accounted for as if there was an acquisition of an asset and an incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases. Assets recorded under capital leases are amortized according to the same depreciation methods employed for property, plant and equipment or over the term of the related lease, if shorter. | |||||||||
The Company defers any profit or loss from a sale-leaseback transaction unless any of the following conditions exist: a) the seller-lessee relinquishes the right to substantially all of the remaining use of the property sold retaining only a minor portion of such use; b) the seller-lessee retains more than a minor part but less than substantially all of the use of the property through the leaseback and realizes a profit on the sale in excess of the recorded amount of the leased assets; or c) the fair value of the property at the time of the transaction is less than its undepreciated cost, in which circumstance a loss shall be recognized immediately. | |||||||||
Income Taxes | ' | ||||||||
Income Taxes | |||||||||
The Company accounts for income taxes pursuant to ASC Topic 740, Income Taxes. Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Any tax paid by subsidiaries during the year is recorded. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. ASC Topic 740 also requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carry-forwards. ASC Topic 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets, including those related to the U.S. net operating loss carry-forwards, are dependent upon future earnings, if any, of which the timing and amount are uncertain. | |||||||||
The Company adopted ASC Topic 740-10-05, Income Tax, which provides guidance for recognizing and measuring uncertain tax positions, it prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the financial statements. It also provides accounting guidance on derecognizing, classification and disclosure of these uncertain tax positions. | |||||||||
The Company’s policy on classification of all interest and penalties related to unrecognized income tax positions, if any, is to present them as a component of income tax expense. | |||||||||
Value Added Tax | ' | ||||||||
Value Added Tax | |||||||||
Both the PRC subsidiary and variable interest entity of the Company are subject to value added tax (“VAT”) imposed by the PRC government on its purchase and sales of goods. The output VAT is charged to customers who purchase goods from the Company and the input VAT is paid when it purchases goods from its vendors. VAT rate is 17% in general, depending on the types of products purchased and sold. The input VAT can be offset against the output VAT. Debit balance of VAT payable represents a credit against future collection of output VAT instead of a receivable. | |||||||||
Comprehensive Income (Loss) | ' | ||||||||
Comprehensive Income (Loss) | |||||||||
The Company presents comprehensive income (loss) in accordance with ASC Topic 220, Comprehensive Income. ASC Topic 220 states that all items that are required to be recognized under accounting standards as components of comprehensive income (loss) be reported in the consolidated financial statements. The components of comprehensive income were the net income for the years and the foreign currency translation adjustments. | |||||||||
Earnings Per Share | ' | ||||||||
Earnings Per Share | |||||||||
Basic earnings per share is computed by dividing the net income attributable to the common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. | |||||||||
Share-Based Compensation | ' | ||||||||
Share-Based Compensation | |||||||||
The Company uses the fair value recognition provision of ASC Topic 718, Compensation-Stock Compensation, which requires the Company to expense the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of such instruments over the vesting period. | |||||||||
The Company also applies the provisions of ASC Topic 505-50, Equity Based Payments to Non-Employees to account for stock-based compensation awards issued to non-employees for services. Such awards for services are recorded at either the fair value of the consideration received or the fair value of the instruments issued in exchange for such services, whichever is more reliably measurable. | |||||||||
Fair Value Measurements | ' | ||||||||
Fair Value Measurements | |||||||||
The Company has adopted ASC Topic 820, Fair Value Measurements and Disclosures, which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. It does not require any new fair value measurements, but provides guidance on how to measure fair value by providing a fair value hierarchy used to classify the source of the information. | |||||||||
Its establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable inputs, which may be used to measure fair value and include the following: | |||||||||
Level 1 - Quoted prices in active markets for identical assets or liabilities. | |||||||||
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |||||||||
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | |||||||||
Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement. | |||||||||
Non-Recurring Fair Value Measurements | ' | ||||||||
Non-Recurring Fair Value Measurements | |||||||||
Long-lived assets are measured at fair value on a non-recurring basis using mostly Level 3 inputs as defined in the fair value hierarchy. These assets are not measured at fair value on an ongoing basis, but are subject to fair value adjustments only in certain circumstances. Assets that are written down to fair value when impaired and retained investments are not subsequently adjusted to fair value unless further impairment occurs. | |||||||||
Fair value of long-lived assets, including real estate, are determined by estimating the amount and timing of net future cash flows (which are unobservable inputs) and discounting them using a risk-adjusted rate of interest. The Company estimates future cash flows based on its experience and knowledge of the market. Significant increases or decreases in actual cash flows may result in valuation changes. For real estate, fair values are based on discounted cash flow estimates which reflect current and projected lease profiles and available industry information about capitalization rates and expected trends in rents and occupancy and are corroborated by external appraisals. | |||||||||
Working Capital Deficit and Management's Plan | ' | ||||||||
Working Capital Deficit and Management’s Plan. | |||||||||
As of December 31, 2013, the Company had current assets of $25,953,328 and current liabilities of $28,372,723 (including amounts due to related parties for $2,266,961), resulting in a working capital deficit of approximately $2,419,395. We are currently seeking to restructure the term of our liabilities by raising funds through long-term loans to pay off liabilities with shorter terms. Our ability to continue as a going concern is dependent upon obtaining the necessary financing or negotiating the terms of the existing short-term liabilities to meet our current and future liquidity needs. As management believes it can secure financial resources to satisfy the Company’s current liabilities and the capital expenditure needs in the next 12 months, our consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern. | |||||||||
On March 3, 2014 Orient Paper entered into a Revolving Line of Credit Agreement with Shanghai Pudong Development Bank for a total credit facility in the amount of approximately $3.3 million. Pursuant to the credit facility, the Company may draw six-month bank acceptance notes for up to approximately $3.3 million for making supplier payments. The facility has a term for the period of March 3, 2014 through January 12, 2015 and is collateralized by a land use right provided by Hebei Fangsheng Real Estate Development Co. Ltd., a related party controlled by our Chairman and CEO Mr. Zhenyong Liu. | |||||||||
On March 25, 2014, our Chairman and CEO Mr. Zhenyong Liu agrees in writing to permit the Company to continue to postpone the repayment of the accrued interest on his loan to Orient Paper HB until the Company is able to pay its other creditors in its normal course of business. The accrued interest owned to Mr. Liu was approximately $566,343 and was recorded as part of the current liabilities as of December 31, 2013. | |||||||||
On March 7, 2014, Hebei Tengsheng Paper Co. Ltd., which owns the land use rights of about 330 acres (or 1.33 million square meters) of land in the Wei County Industrial Park and leases about one-fourth of the premises to Orient Paper HB as our production base of tissue paper and other future facilities, agreed in writing to unconditionally provide the 330 acres of land use right as third party collateral to Orient Paper HB for additional bank loans in 2014. |
Organization_and_Business_Back1
Organization and Business Background (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Organization and Business Background [Abstract] | ' | ||||||||
Subsidiaries and Variable Interest Entities | ' | ||||||||
Date of Incorporation | Place of Incorporation | Percentage of | |||||||
Name | or Establishment | or Establishment | Ownership | Principal Activity | |||||
Subsidiary: | |||||||||
Dongfang Holding | 13-Nov-06 | BVI | 100% | Inactive investment holding | |||||
Shengde Holdings | 25-Feb-09 | State of Nevada | 100% | Investment holding | |||||
Orient Paper Shengde | 1-Jun-09 | PRC | 100% | Paper Production and distribution | |||||
Variable interest entity: | |||||||||
Orient Paper HB | 10-Mar-96 | PRC | Control* | Paper Production and distribution | |||||
* Orient Paper HB is treated as a 100% controlled variable interest entity of the Company |
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Significant Accounting Policies [Abstract] | ' | |||||||||||
Allowance for doubtful accounts | ' | |||||||||||
December 31, | December 31, | December 31, | ||||||||||
Allowance of doubtful accounts | 2013 | 2012 | 2011 | |||||||||
Opening balance | $ | 57,643 | $ | 76,752 | $ | 37,535 | ||||||
Provision (Reversal of provision) for the year | 7,990 | (19,631 | ) | 37,087 | ||||||||
Exchange difference | 1,959 | 522 | 2,130 | |||||||||
Closing balance | $ | 67,592 | $ | 57,643 | $ | 76,752 | ||||||
Schedule of property plant and equipment useful life | ' | |||||||||||
Land use right | Over the lease term | |||||||||||
Building and improvements | 30 years | |||||||||||
Machinery and equipment | 5-15 years | |||||||||||
Vehicles | 15 years |
Inventories_Tables
Inventories (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Inventories [Abstract] | ' | ||||||||
Schedule of inventories | ' | ||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Raw Materials | |||||||||
Recycled paper board | $ | 8,004,988 | $ | 11,274,383 | |||||
Pulp | 14,257 | 13,813 | |||||||
Recycled printed paper | - | 884,236 | |||||||
Recycled white scrap paper | 1,791,873 | 766,144 | |||||||
Coal | 573,799 | 621,107 | |||||||
Base paper and other raw materials | 212,984 | 225,912 | |||||||
10,597,901 | 13,785,595 | ||||||||
Finished Goods | 830,504 | 1,318,506 | |||||||
Totals | $ | 11,428,405 | $ | 15,104,101 | |||||
Prepayments_and_Other_Current_1
Prepayments and Other Current Assets (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Prepayments and Other Current Assets [Abstract] | ' | ||||||||
Summary of prepayments and other current assets | ' | ||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Prepaid NYSE MKT annual fee | $ | 7,500 | $ | 6,875 | |||||
Recoverable VAT | 500,000 | 4,784,074 | |||||||
Prepaid insurance | 61,529 | 55,922 | |||||||
Prepayment for purchase of materials | 8,180 | 77,445 | |||||||
Prepaid land lease | 490,822 | 475,541 | |||||||
Others | - | 1,848 | |||||||
$ | 1,068,031 | $ | 5,401,705 | ||||||
Property_Plant_and_Equipment_T
Property, Plant and Equipment (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Schedule of property, plant and equipment | ' | ||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Property, Plant, and Equipment: | |||||||||
Land use rights | $ | 7,761,511 | $ | 9,895,081 | |||||
Building and improvements | 22,406,836 | 31,625,816 | |||||||
Machinery and equipment | 121,088,942 | 111,857,002 | |||||||
Vehicles | 683,051 | 439,007 | |||||||
Construction in progress | 65,160,213 | 1,315,664 | |||||||
217,100,553 | 155,132,570 | ||||||||
Less: accumulated depreciation and amortization | (38,565,294 | ) | (32,741,114 | ) | |||||
Property, Plant and Equipment, net | $ | 178,535,259 | $ | 122,391,456 |
Fair_Value_Measurement_Tables
Fair Value Measurement (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Fair Value Measurement [Abstract] | ' | ||||||||
Summary of fair values for those assets measured at fair value on a non-recurring basis | ' | ||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Long-lived assets | |||||||||
Using Level 1 | $ | - | $ | - | |||||
Using Level 2 | - | - | |||||||
Using Level 3 | - | 1,561,361 | |||||||
Property, Plant and Equipment, net | $ | - | $ | 1,561,361 |
Loans_Payable_Tables
Loans Payable (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Loans Payable [Abstract] | ' | |||||||
Schedule of short-term bank loans | ' | |||||||
December 31, | December 31, | |||||||
2013 | 2012 | |||||||
Industrial & Commercial Bank of China | (a) | $ | - | $ | 792,568 | |||
Industrial & Commercial Bank of China | (b) | - | 1,585,138 | |||||
Bank of Hebei | (c) | - | 1,585,138 | |||||
Industrial & Commercial Bank of China | (d) | 4,090,180 | - | |||||
Industrial & Commercial Bank of China | (e) | 818,036 | - | |||||
Industrial & Commercial Bank of China | (f) | 1,636,072 | - | |||||
Total short-term bank loans | $ | 6,544,288 | $ | 3,962,844 | ||||
(a) | On September 4, 2012, the Company refinanced with the Industrial & Commercial Bank of China (“ICBC”) an accounts receivable factoring facility with a maximum credit limit of $792,568 as of December 31, 2012. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company’s books at all times, are not fully collected. The factoring facility carried an interest rate of 6.6% per annum. The Company paid off the principal balance and accrued interest under the factoring facility on August 28, 2013. | |||||||
(b) | On November 9, 2012, the Company obtained from the ICBC another accounts receivable factoring facility with a maximum credit limit of $1,585,138 as of December 31, 2012. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company’s books at all times, are not fully collected. The term of the factoring facility expired on November 8, 2013 and carried an interest rate of 6.6% per annum, or 1.0% plus the prime rate for the loan set forth by the People’s Bank of China at the time of funding. The Company paid off the principal balance and accrued interest under the factoring facility on November 8, 2013. | |||||||
(c) | On September 19, 2012, the Company obtained from the Bank of Hebei a banking facility with maximum credit limit on bank loans of $1,585,138 and on notes payable of $1,585,138 as of December 31, 2012. The facility was guaranteed by an independent third party. On the same day, the Company drew down from this banking facility a new working capital loan of $1,585,138 as of December 31, 2012. The loan bore interest at the rate of 6.6% per annum. Both the term of the banking facility and loan were for one year and expired on September 19, 2013. The Company paid off the loan balance on September 18, 2013. | |||||||
(d) | On September 2, 2013, the Company entered into a working capital loan agreement with the ICBC for $4,090,180, with which $818,036 is payable on June 5, 2014 and $3,272,144 is payable on August 15, 2014. The loan bears an interest rate of 115% over the primary lending rate of the People’s Bank of China and was at 6.9% per annum at the time of funding. | |||||||
Concurrent with the signing of the working capital loan agreement, the Company also entered into a trust agreement with the ICBC, which provides trust account management services to the Company during the terms of the underlying loan. The working capital loan is guaranteed by Hebei Fangsheng Real Estate Development Co. Ltd. (“Hebei Fangsheng”) with the land use right on our Headquarters Compound pledged by Hebei Fangsheng as collateral for the benefit of the bank. The land use right on our Headquarters Compound was acquired by Hebei Fangsheng from the Company on August 9, 2013 (see Note (11) for the related party transaction). Hebei Fangsheng is controlled by the Company’s Chairman and CEO Mr. Zhenyong Liu. | ||||||||
(e) | On September 6, 2013, the Company obtained a new accounts receivable factoring facility from the ICBC for $818,036. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company’s books at all times, are not fully collected. The factoring facility will expire on August 4, 2014 and bears an interest rate of 110% of the primary lending rate of the People’s Bank of China and was at 6.6% per annum at the time of funding. | |||||||
Concurrent with the signing of the new factoring agreement, the Company also entered into a financial service agreement with ICBC, which provides accounts receivable management services to the Company during the terms of the underlying factoring facility. The factoring facility is personally guaranteed by the Company’s Chairman and CEO Mr. Zhenyong Liu. | ||||||||
(f) | On December 3, 2013, the Company obtained from the ICBC an accounts receivable factoring facility with a maximum credit limit of $1,636,072 as of December 31, 2013. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company’s books at all times, are not fully collected. The term of the factoring facility expires on October 21, 2014 and carries an interest rate of 6.6% per annum, or 1.0% plus the prime rate for the loan set forth by the People’s Bank of China at the time of funding. The unpaid balance of the loan was in the amount of $1,636,072 as of December 31, 2013. | |||||||
Schedule of future minimum lease payments of capital lease | ' | |||||||
Year Ending December 31, | Amount | |||||||
2014 | $ | 9,327,690 | ||||||
2015 | 8,817,611 | |||||||
2016 | 4,218,050 | |||||||
$ | 22,363,351 |
Other_Payables_and_Accrued_Lia1
Other Payables and Accrued Liabilities (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Other Payables and Accrued Liabilities [Abstract] | ' | ||||||||
Summary of other Payables and Accrued Liabilities | ' | ||||||||
December 31, | December 31, | ||||||||
2013 | 2012 | ||||||||
Accrued electricity | $ | 372,726 | $ | 232,763 | |||||
Accrued professional fees | 58,000 | 143,597 | |||||||
Value-added tax payable | 940,400 | - | |||||||
Accrued interest to a related party | 566,343 | 406,324 | |||||||
Accrued bank loan interest | 380,022 | 250,299 | |||||||
Payable for purchase of equipment | - | 152,173 | |||||||
Advance from customer | 11,453 | - | |||||||
Insurance premium payable | 62,348 | 56,773 | |||||||
Others | 260,180 | 20,355 | |||||||
Totals | $ | 2,651,472 | $ | 1,262,284 |
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||
Summary of basic and diluted net income per share | ' | ||||||||||||
Year Ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Basic income per share | |||||||||||||
Net income for the year - numerator | $ | 13,014,648 | $ | 14,672,663 | $ | 21,648,664 | |||||||
Weighted average common stock outstanding - denominator | 18,458,446 | 18,456,781 | 18,349,332 | ||||||||||
Net income per share | $ | 0.71 | $ | 0.79 | $ | 1.18 | |||||||
Diluted income per share | |||||||||||||
Net income for the year - numerator | $ | 13,014,648 | $ | 14,672,663 | $ | 21,648,664 | |||||||
Weighted average common stock outstanding - denominator | 18,458,446 | 18,456,781 | 18,349,332 | ||||||||||
Effect of dilution | - | - | - | ||||||||||
Weighted average common stock outstanding - denominator | 18,458,446 | 18,456,781 | 18,349,332 | ||||||||||
Diluted income per share | $ | 0.71 | $ | 0.79 | $ | 1.18 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Taxes [Abstract] | ' | ||||||||||||
Summary of provisions for income taxes | ' | ||||||||||||
Year Ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Provision for Income Taxes | |||||||||||||
Current Tax Provision - PRC | $ | 4,684,870 | $ | 6,406,050 | $ | 7,799,226 | |||||||
Deferred Tax Provision - PRC | 409,665 | -941,207 | - | ||||||||||
Total Provision for Income Taxes | $ | 5,094,535 | $ | 5,464,843 | $ | 7,799,226 | |||||||
Summary of deferred tax assets (liabilities) | ' | ||||||||||||
December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Deferred tax assets (liabilities) – current: | |||||||||||||
Depreciation and amortization of property, plant and equipment | $ | 139,805 | $ | - | |||||||||
Impairment of property, plant and equipment | 225,656 | - | |||||||||||
Miscellaneous | 48,076 | - | |||||||||||
Total deferred tax asset – current, net | $ | 413,537 | $ | - | |||||||||
Deferred tax assets (liabilities) – non-current | |||||||||||||
Depreciation and amortization of property, plant and equipment | $ | 31,446 | $ | 401,482 | |||||||||
Impairment of property, plant and equipment | 261,805 | 690,916 | |||||||||||
Miscellaneous | (24,922 | ) | (150,742 | ) | |||||||||
Net Operating Loss Carryover for U.S. income tax purposes | 1,445,755 | 2,303,851 | |||||||||||
Total deferred tax assets – non-current | 1,714,084 | 3,245,507 | |||||||||||
Less: Valuation allowance | (1,445,755 | ) | (2,303,851 | ) | |||||||||
Total deferred tax assets – non-current, net | $ | 268,329 | $ | 941,656 | |||||||||
Reconciliation of statutory rates to Company's effective tax rate | ' | ||||||||||||
Year ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
PRC Statutory rate | 25 | % | 25 | % | 25 | % | |||||||
Effect of different tax jurisdiction | (1.1 | ) | (0.6 | ) | (0.6 | ) | |||||||
Effect of expenses not deductible for PRC tax purposes | 1.5 | - | 0.1 | ||||||||||
Effect of income not taxable for PRC tax purposes | - | 0.3 | (0.3 | ) | |||||||||
Under provision in previous year | - | - | 0.1 | ||||||||||
Change in valuation allowance | 2.7 | 2.4 | 2.2 | ||||||||||
Effective income tax rate | 28.1 | % | 27.1 | % | 26.5 | % |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||
Dec. 31, 2013 | |||||
Commitments and Contingencies [Abstract] | ' | ||||
Schedule of future minimum lease payments of capital lease | ' | ||||
Year Ending December 31, | Amount | ||||
2014 | $ | 9,327,690 | |||
2015 | 8,817,611 | ||||
2016 | 4,218,050 | ||||
$ | 22,363,351 |
Segment_Reporting_Tables
Segment Reporting (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||||||
Summarized financial information for reportable segments | ' | |||||||||||||||||||
Year Ended | ||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||
Orient Paper | Orient Paper | Not Attributable | Elimination | Enterprise-wide, | ||||||||||||||||
HB | Shengde | to Segments | of Inter-segment | consolidated | ||||||||||||||||
Revenues | $ | 120,747,633 | $ | 4,969,997 | $ | - | $ | - | $ | 125,717,630 | ||||||||||
Gross Profit | 22,318,739 | 1,006,860 | - | - | 23,325,599 | |||||||||||||||
Depreciation and amortization | 6,828,970 | 965,773 | - | - | 7,794,743 | |||||||||||||||
Interest income | 86,168 | 4,009 | 83 | - | 90,260 | |||||||||||||||
Interest expense | 995,694 | - | - | - | 995,694 | |||||||||||||||
Income tax expense | 4,845,970 | 248,565 | - | - | 5,094,535 | |||||||||||||||
Net Income (Loss) | 14,604,244 | 638,031 | (2,227,627 | ) | - | 13,014,648 | ||||||||||||||
Total Assets | 168,149,877 | 41,264,704 | 111,621 | - | 209,526,202 | |||||||||||||||
Year Ended | ||||||||||||||||||||
31-Dec-12 | ||||||||||||||||||||
Orient Paper | Orient Paper | Not Attributable | Elimination | Enterprise-wide, | ||||||||||||||||
HB | Shengde | to Segments | of Inter-segment | consolidated | ||||||||||||||||
Revenues | $ | 144,928,792 | $ | 6,188,014 | $ | - | $ | - | $ | 151,116,806 | ||||||||||
Gross Profit | 25,616,670 | 1,439,577 | - | - | 27,056,247 | |||||||||||||||
Depreciation and amortization | 6,553,120 | 1,829,739 | - | - | 8,382,859 | |||||||||||||||
Impairment | 2,762,349 | - | - | - | 2,762,349 | |||||||||||||||
Interest income | 25,950 | 4,634 | 90 | - | 30,674 | |||||||||||||||
Interest expense | 867,561 | - | 4,273 | - | 871,834 | |||||||||||||||
Income tax expense | 5,129,304 | 335,539 | - | - | 5,464,843 | |||||||||||||||
Net Income (Loss) | 15,109,345 | 965,444 | (1,402,126 | ) | - | 14,672,663 | ||||||||||||||
Total Assets | 119,707,195 | 43,076,428 | 62,701 | - | 162,846,324 | |||||||||||||||
Year Ended | ||||||||||||||||||||
December 31, 2011 | ||||||||||||||||||||
Orient Paper | Orient Paper | Not Attributable | Elimination | Enterprise-wide, | ||||||||||||||||
HB | Shengde | to Segments | of Inter-segment | consolidated | ||||||||||||||||
Revenues | $ | 142,498,116 | $ | 8,249,200 | $ | - | $ | - | $ | 150,747,316 | ||||||||||
Gross Profit | 30,191,480 | 2,758,595 | - | - | 32,950,075 | |||||||||||||||
Depreciation and amortization | 3,504,717 | 919,814 | - | - | 4,424,531 | |||||||||||||||
Interest income | 20,847 | 15,273 | 317 | - | 36,437 | |||||||||||||||
Interest expense | 699,892 | - | - | - | 699,892 | |||||||||||||||
Income tax expense | 7,136,886 | 662,340 | - | - | 7,799,226 | |||||||||||||||
Net Income (Loss) | 21,527,824 | 1,961,694 | (1,840,854 | ) | - | 21,648,664 |
Summarized_Quarterly_Financial1
Summarized Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Summarized Quarterly Financial Data [Abstract] | ' | ||||||||||||||||
Schedule of quarterly financial information | ' | ||||||||||||||||
Quarter | |||||||||||||||||
2013 | First | Second | Third | Fourth | |||||||||||||
Revenues | $ | 19,746,656 | 33,038,512 | 37,686,114 | 35,246,348 | ||||||||||||
Gross Profit | 1,630,237 | 6,098,395 | 8,435,814 | 7,161,153 | |||||||||||||
Income from Operations | 743,071 | 5,211,839 | 7,563,522 | 5,325,060 | |||||||||||||
Net income | 303,055 | 3,656,136 | 5,534,844 | 3,520,613 | |||||||||||||
Net income per share: | |||||||||||||||||
Basic | $ | 0.02 | 0.02 | 0.3 | 0.19 | ||||||||||||
Diluted | $ | 0.02 | 0.02 | 0.3 | 0.19 | ||||||||||||
Quarter | |||||||||||||||||
2012 | First | Second | Third | Fourth | |||||||||||||
Revenues | $ | 34,408,999 | $ | 35,521,672 | $ | 37,651,354 | $ | 43,534,781 | |||||||||
Gross Profit | 7,753,172 | 5,785,664 | 6,820,053 | 6,697,358 | |||||||||||||
Income from Operations | 6,708,500 | 5,099,534 | 6,161,418 | 3,009,214 | |||||||||||||
Net income | 4,681,691 | 3,610,790 | 4,379,071 | 2,001,111 | |||||||||||||
Net income per share: | |||||||||||||||||
Basic | $ | 0.25 | $ | 0.2 | $ | 0.24 | $ | 0.11 | |||||||||
Diluted | $ | 0.25 | $ | 0.2 | $ | 0.24 | $ | 0.11 |
Condensed_Financial_Informatio1
Condensed Financial Information of the Parent Company (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Condensed Financial Statements, Captions [Line Items] | ' | ||||||||||||
CONDENSED BALANCE SHEETS | ' | ||||||||||||
December 31, | December 31, | ||||||||||||
2013 | 2012 | ||||||||||||
ASSETS | |||||||||||||
Current Assets | |||||||||||||
Cash and cash equivalents | $ | 42,592 | $ | - | |||||||||
Prepayments and other current assets | 69,029 | 62,797 | |||||||||||
Total current assets | 111,621 | 62,797 | |||||||||||
Investment in subsidiaries | 163,658,397 | 143,597,251 | |||||||||||
Total Assets | $ | 163,770,018 | $ | 143,660,048 | |||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||||
Current Liabilities | |||||||||||||
Bank overdraft | $ | - | $ | 96 | |||||||||
Inter-company payable | 2,544,855 | 736,378 | |||||||||||
Accrued payroll and employee benefit | 51,667 | 40,000 | |||||||||||
Accrued liabilities | 58,000 | 58,000 | |||||||||||
Insurance premium payable | 62,348 | 56,773 | |||||||||||
Total current liabilities | 2,716,870 | 891,247 | |||||||||||
Total liabilities | 2,716,870 | 891,247 | |||||||||||
Total stockholders' equity | 161,053,148 | 142,768,801 | |||||||||||
Total Liabilities and Stockholders' Equity | $ | 163,770,018 | $ | 143,660,048 | |||||||||
CONDENSED STATEMENTS OF INCOME | ' | ||||||||||||
CONDENSED STATEMENTS OF INCOME | |||||||||||||
Year Ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Operating expenses | |||||||||||||
Selling, general and administrative expenses | $ | 2,227,711 | $ | 1,397,943 | $ | 1,841,171 | |||||||
Loss from Operations | (2,227,711 | ) | (1,397,943 | ) | (1,841,171 | ) | |||||||
Equity in earnings of unconsolidated subsidiaries | 15,242,276 | 16,074,789 | 23,489,518 | ||||||||||
Other Income (Expense) | 83 | (4,183 | ) | 317 | |||||||||
Income before Income Taxes | 13,014,648 | 14,672,663 | 21,648,664 | ||||||||||
Provision for Income Taxes | - | - | - | ||||||||||
Net Income | $ | 13,014,648 | $ | 14,672,663 | $ | 21,648,664 | |||||||
CONDENSED STATEMENTS OF CASH FLOWS | ' | ||||||||||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||||||||||
Year Ended | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Net Cash Provided by (Used in) Operating Activities | $ | 365,720 | $ | 546,760 | $ | 75,537 | |||||||
Net Cash Used in Investing Activities | - | - | - | ||||||||||
Net Cash Used in Financing Activities | (323,032 | ) | (692,242 | ) | - | ||||||||
Net Increase (Decrease) in Cash and Cash Equivalents | 42,688 | (145,482 | ) | 75,537 | |||||||||
Cash and Cash Equivalents - Beginning of Period | (96 | ) | 145,386 | 69,849 | |||||||||
Cash and Cash Equivalents - End of Period | $ | 42,592 | $ | (96 | ) | $ | 145,386 |
Organization_and_Business_Back2
Organization and Business Background (Details) | 12 Months Ended | |
Dec. 31, 2013 | ||
Dongfang Holding [Member] | ' | |
Schedule of company's subsidiaries and variable interest entities | ' | |
Entity Incorporation, Date Of Incorporation | 13-Nov-06 | |
Entity Incorporation State Country Name | 'BVI | |
Percentage of Ownership | 100.00% | |
Principal Activity | 'Inactive investment holding | |
Shengde Holding [Member] | ' | |
Schedule of company's subsidiaries and variable interest entities | ' | |
Entity Incorporation, Date Of Incorporation | 25-Feb-09 | |
Entity Incorporation State Country Name | 'State of Nevada | |
Percentage of Ownership | 100.00% | |
Principal Activity | 'Investment holding | |
Orient Paper Shengde [Member] | ' | |
Schedule of company's subsidiaries and variable interest entities | ' | |
Entity Incorporation, Date Of Incorporation | 1-Jun-09 | |
Entity Incorporation State Country Name | 'PRC | |
Percentage of Ownership | 100.00% | |
Principal Activity | 'Paper Production and distribution | |
Orient Paper HB [Member] | ' | |
Schedule of company's subsidiaries and variable interest entities | ' | |
Entity Incorporation, Date Of Incorporation | 10-Mar-96 | |
Entity Incorporation State Country Name | 'PRC | |
Percentage of Ownership | ' | [1] |
Principal Activity | 'Paper Production and distribution | |
[1] | Orient Paper HB is treated as a 100% controlled variable interest entity of the Company |
Organization_and_Business_Back3
Organization and Business Background (Details Textual) | 0 Months Ended | 1 Months Ended | 12 Months Ended | |||||||||||||
Feb. 10, 2010 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2010 | Jun. 30, 2009 | Oct. 31, 2007 | Jul. 31, 2007 | Oct. 29, 2007 | Jun. 30, 2010 | Feb. 10, 2010 | Jun. 24, 2009 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Feb. 10, 2010 | Dec. 31, 2009 | |
CNY | USD ($) | USD ($) | Shengde Holdings [Member] | Dongfang Holding [Member] | Dongfang Holding [Member] | Dongfang Holding [Member] | Orient Paper Shengde [Member] | Orient Paper Shengde [Member] | Orient Paper Shengde [Member] | Orient Paper HB [Member] | Orient Paper HB [Member] | Orient Paper HB [Member] | Orient Paper HB [Member] | Orient Paper HB [Member] | ||
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | |||||||||||
Organization and Business Background (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of ownership | ' | ' | ' | ' | 100.00% | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares of common stock issued to Dongfang Holding shareholders under Merger Agreement | ' | ' | ' | ' | ' | 7,450,497 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock, par value | ' | $0.00 | $0.00 | ' | ' | ' | ' | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' |
Registered capital | ' | ' | ' | ' | ' | ' | ' | ' | $60,000,000 | ' | $10,000,000 | ' | ' | ' | ' | ' |
Service fees to Orient Paper Shengde percentage of Orient Paper HB total net profits | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 80.00% | ' |
Amount loaned by Orient Paper Shengde to Orient Paper HB equity holders | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 |
Exercise price for the options | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loans terminated | ' | ' | ' | ' | ' | ' | ' | ' | ' | $10,000,000 | ' | ' | ' | ' | $10,000,000 | ' |
Percentage of distributable profit of Orient Paper HB entitled to Orient Paper Shengde | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of revenue from Orient Paper HB | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 96.05% | 95.91% | 94.50% | ' | ' |
Percentage of assets accounted by Orient Paper HB | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 80.25% | 73.51% | ' | ' | ' |
Significant_Accounting_Policie3
Significant Accounting Policies (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Allowance of doubtful accounts | ' | ' | ' |
Opening balance | $57,643 | $76,752 | $37,535 |
Provision (Reversal of provision) for the year | 7,990 | -19,631 | 37,087 |
Exchange difference | 1,959 | 522 | 2,130 |
Closing balance | $67,592 | $57,643 | $76,752 |
Significant_Accounting_Policie4
Significant Accounting Policies (Details 1) | 12 Months Ended |
Dec. 31, 2013 | |
Land use right [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, plant, and equipment useful life | ' |
Over the lease term | |
Building and improvements [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, plant and equipment, useful life | '30 years |
Machinery and equipment [Member] | Maximum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, plant and equipment, useful life | '15 years |
Machinery and equipment [Member] | Minimum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, plant and equipment, useful life | '5 years |
Vehicles [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, plant and equipment, useful life | '15 years |
Significant_Accounting_Policie5
Significant Accounting Policies (Details Textual) | 12 Months Ended | |||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2010 | Mar. 25, 2014 | Mar. 07, 2014 | Mar. 03, 2014 | |
USD ($) | USD ($) | USD ($) | CNY | USD ($) | Mr. Zhenyong Liu [Member] | Hebei Tengsheng Paper Co. Ltd [Member] | Shanghai Pudong Development Bank [Member] | |
Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | ||||||
USD ($) | acre | USD ($) | ||||||
Significant Accounting Policies (Textual) | ' | ' | ' | ' | ' | ' | ' | ' |
Current currency exchange rate to translate Chinese RMB to U.S. Dollars | 6.1122 | 6.3086 | ' | ' | ' | ' | ' | ' |
Currency average exchange rate to translate Chinese RMB to U.S. Dollars | 6.1943 | 6.3116 | 6.4544 | ' | ' | ' | ' | ' |
Accounts receivable, allowance for doubtful accounts | $67,592 | $57,643 | $76,752 | ' | $37,535 | ' | ' | ' |
Percentage of net profit allocate to reserve fund | ' | ' | ' | ' | ' | ' | ' | ' |
At least 10% of its net profit to the reserve fund until the balance of such fund has reached 50% of its registered capital. | ||||||||
Net profit transferred to statutory reserve fund | 74,446 | 100,518 | 201,855 | ' | ' | ' | ' | ' |
Orient Paper HB statutory reserve fund account | 11,811,470 | ' | ' | 75,030,000 | ' | ' | ' | ' |
Variable interest entity net profit transferred to statutory reserve fund | 0 | 0 | 0 | ' | ' | ' | ' | ' |
Provision for employee benefits plan | ' | ' | ' | ' | ' | ' | ' | ' |
Advertising and promotion costs | 5,085 | 10,478 | 6,818 | ' | ' | ' | ' | ' |
Research and development costs | 25,125 | 21,636 | 19,756 | ' | ' | ' | ' | ' |
Subsidy income | 171,125 | ' | ' | ' | ' | ' | ' | ' |
Lease Obligations Description | ' | ' | ' | ' | ' | ' | ' | ' |
c) the lease term is at least 75% of the property’s estimated remaining economic life or d) the present value of the minimum lease payments at the beginning of the lease term is 90% or more of the fair value of the leased property to the lessor at the inception date. | ||||||||
VAT rate | 17.00% | ' | ' | ' | ' | ' | ' | ' |
Current assets | 25,953,328 | 38,067,567 | ' | ' | ' | ' | ' | ' |
Current liabilities | 28,372,723 | 16,200,923 | ' | ' | ' | ' | ' | ' |
Due to a related party | 64,546 | ' | ' | ' | ' | ' | ' | ' |
Working capital | 2,419,395 | ' | ' | ' | ' | ' | ' | ' |
Short-term bank loans | 6,544,288 | 3,962,844 | ' | ' | ' | ' | ' | 3,300,000 |
Accrued interest | $946,365 | $656,623 | ' | ' | ' | $566,343 | ' | ' |
Area of land | ' | ' | ' | ' | ' | ' | 330 | ' |
Restricted_Cash_Details
Restricted Cash (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Restricted Cash (Textual) | ' | ' |
Restricted cash | $2,454,108 | $1,585,138 |
Description of lifting of restricted cash | ' | ' |
The restriction will be lifted upon the maturity of the notes payable from May 15 through June 19 during the year of 2014. | The restriction was lifted upon the maturity of the notes payable on June 18, 2013. |
Inventories_Details
Inventories (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of inventories | ' | ' |
Raw materials, Gross | $10,597,901 | $13,785,595 |
Finished goods | 830,504 | 1,318,506 |
Totals | 11,428,405 | 15,104,101 |
Recycled paper board [Member] | ' | ' |
Schedule of inventories | ' | ' |
Raw materials, Gross | 8,004,988 | 11,274,383 |
Pulp [Member] | ' | ' |
Schedule of inventories | ' | ' |
Raw materials, Gross | 14,257 | 13,813 |
Recycled printed paper [Member] | ' | ' |
Schedule of inventories | ' | ' |
Raw materials, Gross | ' | 884,236 |
Recycled white scrap paper [Member] | ' | ' |
Schedule of inventories | ' | ' |
Raw materials, Gross | 1,791,873 | 766,144 |
Coal [Member] | ' | ' |
Schedule of inventories | ' | ' |
Raw materials, Gross | 573,799 | 621,107 |
Base paper and other raw materials [Member] | ' | ' |
Schedule of inventories | ' | ' |
Raw materials, Gross | $212,984 | $225,912 |
Prepayments_and_Other_Current_2
Prepayments and Other Current Assets (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Summary of prepayments and other current assets | ' | ' |
Prepaid NYSE MKT annual fee | $7,500 | $6,875 |
Recoverable VAT | 500,000 | 4,784,074 |
Prepaid insurance | 61,529 | 55,922 |
Prepayment for purchase of materials | 8,180 | 77,445 |
Prepaid land lease | 490,822 | 475,541 |
Others | ' | 1,848 |
Prepayments and other current assets, Total | $1,068,031 | $5,401,705 |
Prepayments_and_Other_Current_3
Prepayments and Other Current Assets (Details Textual) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Prepayments and other current assets (Textual) | ' | ' |
Total Vat Recoverable | $3,777,188 | ' |
Recoverable VAT | 3,277,188 | ' |
Recoverable VAT, Current | $500,000 | $4,784,074 |
Recovered_Sheet1
Prepayment on property, plant and equipment (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Oct. 26, 2012 |
sqm | |||
Prepayment on property, plant and equipment (Textual) | ' | ' | ' |
Prepayment on property, plant and equipment | $1,492,098 | $1,445,645 | ' |
Entitlement of land use rights in Xushui County, Baoding plant | ' | ' | 54,267 |
Assets_Held_for_Sale_Details
Assets Held for Sale (Details) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Dormitory | |
Assets Held for Sale [Abstract] | ' |
Assets Held-for-sale, Current | $4,130,590 |
Number of employee dormitory buildings sold | 3 |
Long Lived Assets Held-for-sale, Description | ' |
As the sale was not yet completed by the end of December 31, 2013, the dormitories were classified as held for sale in accordance with ASC 360-10-35. It was expected that the sales will be consummated by the second half of year 2014. |
Property_Plant_and_Equipment_D
Property, Plant and Equipment (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of property, plant and equipment | ' | ' |
Property, Plant, and Equipment, Gross | $217,100,553 | $155,132,570 |
Less: accumulated depreciation and amortization | -38,565,294 | -32,741,114 |
Property, Plant and Equipment, net | 178,535,259 | 122,391,456 |
Land use rights [Member] | ' | ' |
Schedule of property, plant and equipment | ' | ' |
Property, Plant, and Equipment, Gross | 7,761,511 | 9,895,081 |
Building and improvements [Member] | ' | ' |
Schedule of property, plant and equipment | ' | ' |
Property, Plant, and Equipment, Gross | 22,406,836 | 31,625,816 |
Machinery and equipment [Member] | ' | ' |
Schedule of property, plant and equipment | ' | ' |
Property, Plant, and Equipment, Gross | 121,088,942 | 111,857,002 |
Vehicles [Member] | ' | ' |
Schedule of property, plant and equipment | ' | ' |
Property, Plant, and Equipment, Gross | 683,051 | 439,007 |
Construction in progress [Member] | ' | ' |
Schedule of property, plant and equipment | ' | ' |
Property, Plant, and Equipment, Gross | $65,160,213 | $1,315,664 |
Property_Plant_and_Equipment_D1
Property, Plant and Equipment (Details Textual) | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jun. 16, 2013 | Jun. 16, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | |
USD ($) | USD ($) | USD ($) | Sale-leaseback arrangement [Member] | Sale-leaseback arrangement [Member] | Sale-leaseback arrangement [Member] | Land use rights [Member] | Land use rights [Member] | Land use right one [Member] | Land use right two [Member] | |
T | USD ($) | CNY | USD ($) | USD ($) | USD ($) | |||||
Dormitory | Land_Use_Right | |||||||||
Property, Plant and Equipment (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Lease term | ' | ' | ' | ' | ' | ' | ' | '50 years | ' | ' |
Number of land use rights | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' |
Lease expiration year | ' | ' | ' | ' | ' | ' | '2061 | ' | '2053 | '2061 |
Property plant and equipment pledged for long term loan | $21,901,456 | $9,316,645 | ' | ' | ' | ' | ' | $7,419,614 | ' | ' |
Total financing proceeds | ' | ' | ' | 24,000,000 | 150,000,000 | ' | ' | ' | ' | ' |
Proceeds from sale of paper manufacturing equipment to leasing company | 24,215,811 | ' | ' | 24,000,000 | 150,000,000 | ' | ' | ' | ' | ' |
Term of lease | ' | ' | ' | '3 years | '3 years | ' | ' | ' | ' | ' |
Nominal purchase price | ' | ' | ' | 2,400 | 15,000 | ' | ' | ' | ' | ' |
Deferred gain on sale of leased equipment | 1,160,271 | ' | ' | 1,379,282 | ' | ' | ' | ' | ' | ' |
Capital lease equipment | 25,993,677 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation of capital lease equipment | ' | ' | ' | ' | ' | 818,796 | ' | ' | ' | ' |
Accumulated depreciation of lease asset | ' | ' | ' | ' | ' | 829,794 | ' | ' | ' | ' |
Gain on sale leaseback realized transaction | ' | ' | ' | ' | ' | 228,979 | ' | ' | ' | ' |
Amount of interest capitalized | 448,950 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Assets held for sale | 4,130,590 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of building sold | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Assets pledged for the guarantee of Orient Paper HB's capital lease | 36,134,038 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Production capacity of manufacturing equipment PM8 (per year) | 15,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of Long term loan of third party (paid off on June 3, 2013) | ' | 1,505,881 | ' | ' | ' | ' | ' | ' | ' | ' |
Value of land use right pledged for sale-leaseback financing | 7,502,794 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation and amortization | 7,794,743 | 8,382,859 | 4,424,531 | ' | ' | ' | ' | ' | ' | ' |
Addition of machinery and equipment | 116,067,537 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Property plant and equipment loan drawn from banking facility | 34,177 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unamortized deferred gain | ' | ' | ' | ' | ' | $1,160,271 | ' | ' | ' | ' |
Fair_Value_Measurement_Details
Fair Value Measurement (Details) (Non-recurring basis [Member], USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Long-lived assets | ' | ' |
Property, Plant and Equipment, net | ' | $1,561,361 |
Using Level 1 [Member] | ' | ' |
Long-lived assets | ' | ' |
Property, Plant and Equipment, net | ' | ' |
Using Level 2 [Member] | ' | ' |
Long-lived assets | ' | ' |
Property, Plant and Equipment, net | ' | ' |
Using Level 3 [Member] | ' | ' |
Long-lived assets | ' | ' |
Property, Plant and Equipment, net | ' | $1,561,361 |
Fair_Value_Measurement_Details1
Fair Value Measurement (Details Textual) (USD $) | 12 Months Ended | |
Dec. 31, 2012 | Dec. 31, 2013 | |
Fair Value Measurement (Textual) | ' | ' |
Assets, carrying value | $162,846,324 | $209,526,202 |
Corrugating Medium Production Line [Member] | ' | ' |
Fair Value Measurement (Textual) | ' | ' |
Asset Impairment Charges | 2,762,349 | ' |
Assets, carrying value | ' | 4,325,023 |
Carrying Value Of Asset Written Down | ' | $1,561,361 |
Loans_Payable_Details
Loans Payable (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | ||
Schedule of short-term bank loans | ' | ' | ||
Short-term bank loans | $6,544,288 | $3,962,844 | ||
Industrial & Commercial Bank of China (a) [Member] | Factoring Facility [Member] | ' | ' | ||
Schedule of short-term bank loans | ' | ' | ||
Short-term bank loans | ' | [1] | 792,568 | [1] |
Industrial & Commercial Bank of China (b) [Member] | Factoring Facility [Member] | ' | ' | ||
Schedule of short-term bank loans | ' | ' | ||
Short-term bank loans | ' | [2] | 1,585,138 | [2] |
Bank of Hebei (c) [Member] | ' | ' | ||
Schedule of short-term bank loans | ' | ' | ||
Short-term bank loans | ' | [3] | 1,585,138 | [3] |
Industrial & Commercial Bank of China (d) [Member] | Factoring Facility [Member] | ' | ' | ||
Schedule of short-term bank loans | ' | ' | ||
Short-term bank loans | 4,090,180 | [4] | ' | [4] |
Industrial & Commercial Bank of China (e) [Member] | Factoring Facility [Member] | ' | ' | ||
Schedule of short-term bank loans | ' | ' | ||
Short-term bank loans | 818,036 | [5] | ' | [5] |
Industrial & Commercial Bank of China (f) [Member] | Factoring Facility [Member] | ' | ' | ||
Schedule of short-term bank loans | ' | ' | ||
Short-term bank loans | $1,636,072 | [6] | ' | [6] |
[1] | (a) On September 4, 2012, the Company refinanced with the Industrial & Commercial Bank of China ("ICBC") an accounts receivable factoring facility with a maximum credit limit of $792,568 as of December 31, 2012. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company's books at all times, are not fully collected. The factoring facility carried an interest rate of 6.6% per annum. The Company paid off the principal balance and accrued interest under the factoring facility on August 28, 2013. | |||
[2] | (b) On November 9, 2012, the Company obtained from the ICBC another accounts receivable factoring facility with a maximum credit limit of $1,585,138 as of December 31, 2012. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company's books at all times, are not fully collected. The term of the factoring facility expired on November 8, 2013 and carried an interest rate of 6.6% per annum, or 1.0% plus the prime rate for the loan set forth by the People's Bank of China at the time of funding. The Company paid off the principal balance and accrued interest under the factoring facility on November 8, 2013. | |||
[3] | (c) On September 19, 2012, the Company obtained from the Bank of Hebei a banking facility with maximum credit limit on bank loans of $1,585,138 and on notes payable of $1,585,138 as of December 31, 2012. The facility was guaranteed by an independent third party. On the same day, the Company drew down from this banking facility a new working capital loan of $1,585,138 as of December 31, 2012. The loan bore interest at the rate of 6.6% per annum. Both the term of the banking facility and loan were for one year and expired on September 19, 2013. The Company paid off the loan balance on September 18, 2013. | |||
[4] | (d) On September 2, 2013, the Company entered into a working capital loan agreement with the ICBC for $4,090,180, with which $818,036 is payable on June 5, 2014 and $3,272,144 is payable on August 15, 2014. The loan bears an interest rate of 115% over the primary lending rate of the People's Bank of China and was at 6.9% per annum at the time of funding.Concurrent with the signing of the working capital loan agreement, the Company also entered into a trust agreement with the ICBC, which provides trust account management services to the Company during the terms of the underlying loan. The working capital loan is guaranteed by Hebei Fangsheng Real Estate Development Co. Ltd. ("Hebei Fangsheng") with the land use right on our Headquarters Compound pledged by Hebei Fangsheng as collateral for the benefit of the bank. The land use right on our Headquarters Compound was acquired by Hebei Fangsheng from the Company on August 9, 2013 (see Note (11) for the related party transaction). Hebei Fangsheng is controlled by the Company's Chairman and CEO Mr. Zhenyong Liu. | |||
[5] | (e) On September 6, 2013, the Company obtained a new accounts receivable factoring facility from the ICBC for $818,036. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company's books at all times, are not fully collected. The factoring facility will expire on August 4, 2014 and bears an interest rate of 110% of the primary lending rate of the People's Bank of China and was at 6.6% per annum at the time of funding. Concurrent with the signing of the new factoring agreement, the Company also entered into a financial service agreement with ICBC, which provides accounts receivable management services to the Company during the terms of the underlying factoring facility. The factoring facility is personally guaranteed by the Company's Chairman and CEO Mr. Zhenyong Liu. | |||
[6] | (f) On December 3, 2013, the Company obtained from the ICBC an accounts receivable factoring facility with a maximum credit limit of $1,636,072 as of December 31, 2013. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company's books at all times, are not fully collected. The term of the factoring facility expires on October 21, 2014 and carries an interest rate of 6.6% per annum, or 1.0% plus the prime rate for the loan set forth by the People's Bank of China at the time of funding. The unpaid balance of the loan was in the amount of $1,636,072 as of December 31, 2013. |
Loans_Payable_Details_1
Loans Payable (Details 1) (USD $) | Dec. 31, 2013 |
Schedule of future minimum capital lease payments | ' |
2014 | $9,327,690 |
2015 | 8,817,611 |
2016 | 4,218,050 |
Capital Leases, Future Payments | $22,363,351 |
Loans_Payable_Details_Textual
Loans Payable (Details Textual) | 0 Months Ended | 12 Months Ended | 1 Months Ended | 0 Months Ended | 0 Months Ended | 12 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | ||||||||||||||||||||||||||||||||||
Jul. 15, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 16, 2013 | Jun. 16, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 10, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 02, 2013 | Sep. 02, 2013 | Sep. 02, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 06, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Jun. 16, 2013 | Jun. 16, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | |||||||||||||
USD ($) | USD ($) | USD ($) | Rural Credit Union of Xushui County [Member] | Rural Credit Union of Xushui County [Member] | Rural Credit Union of Xushui County [Member] | Sale-leaseback arrangement [Member] | Sale-leaseback arrangement [Member] | Term Loan [Member] | Term Loan [Member] | New term loan agreement [Member] | New term loan agreement [Member] | New term loan agreement [Member] | Industrial & Commercial Bank of China [Member] | Industrial & Commercial Bank of China [Member] | Industrial & Commercial Bank of China [Member] | Industrial & Commercial Bank of China [Member] | Industrial & Commercial Bank of China [Member] | Industrial & Commercial Bank of China (b) [Member] | Industrial & Commercial Bank of China (b) [Member] | Industrial & Commercial Bank of China (d) [Member] | Industrial & Commercial Bank of China (d) [Member] | Industrial & Commercial Bank of China (e) [Member] | Industrial & Commercial Bank of China (e) [Member] | Industrial & Commercial Bank of China (e) [Member] | Bank of Hebei (c) [Member] | Bank of Hebei (c) [Member] | China National Foreign Trade Financial & Leasing Co. [Member] | China National Foreign Trade Financial & Leasing Co. [Member] | China National Foreign Trade Financial & Leasing Co. [Member] | Industrial & Commercial Bank of China (f) [Member] | Industrial & Commercial Bank of China (f) [Member] | ||||||||||||||
USD ($) | USD ($) | USD ($) | CNY | Rural Credit Union of Xushui County [Member] | Rural Credit Union of Xushui County [Member] | Rural Credit Union of Xushui County [Member] | Rural Credit Union of Xushui County [Member] | Rural Credit Union of Xushui County [Member] | USD ($) | June 15, 2014 [Member] | August 15, 2014 [Member] | Factoring Facility [Member] | Factoring Facility [Member] | Factoring Facility [Member] | Factoring Facility [Member] | Factoring Facility [Member] | Factoring Facility [Member] | Factoring Facility [Member] | Factoring Facility [Member] | Factoring Facility [Member] | USD ($) | USD ($) | Lease financing agreement [Member] | Lease financing agreement [Member] | Collateral Agreement [Member] | Factoring Facility [Member] | Factoring Facility [Member] | ||||||||||||||||||
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | CNY | USD ($) | USD ($) | USD ($) | |||||||||||||||||||||||||||
sqm | |||||||||||||||||||||||||||||||||||||||||||||
Loans Payable (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Maximum credit limit of short term loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $792,568 | ' | $1,585,138 | ' | ' | ' | ' | $818,036 | ' | $1,585,138 | ' | ' | ' | ' | $1,636,072 | ' | ||||||||||||
Unpaid balance of short term debt | ' | 6,544,288 | 3,962,844 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 792,568 | [1] | ' | [1] | 1,585,138 | [2] | ' | [2] | 4,090,180 | [3] | ' | [3] | ' | 818,036 | [4] | ' | [4] | 1,585,138 | [5] | ' | [5] | ' | ' | ' | 1,636,072 | [6] | ' | [6] |
Short-term bank loans, fixed interest rate | ' | 6.68% | 7.82% | 6.38% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.90% | ' | ' | 6.60% | ' | 6.60% | ' | ' | ' | ' | 6.60% | ' | 6.60% | ' | ' | ' | ' | 6.60% | ' | ||||||||||||
Short-term bank loans interest rate as percentage of prime rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 115.00% | ' | ' | ' | ' | 1.00% | ' | ' | ' | ' | 110.00% | ' | ' | ' | ' | ' | ' | 1.00% | ' | ||||||||||||
Loan, maturity date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9-Jun-13 | ' | ' | ' | ' | ' | ' | ' | 8-Nov-13 | ' | ' | ' | 4-Aug-14 | ' | ' | 19-Sep-13 | ' | ' | ' | ' | ' | ' | ||||||||||||
Loan paid off date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 26-Jul-13 | ' | ' | ' | ' | ' | 28-Aug-13 | ' | 8-Nov-13 | ' | ' | ' | ' | ' | ' | 18-Sep-13 | ' | ' | ' | ' | 21-Oct-14 | ' | ||||||||||||
Secured short-term bank loan | ' | 6,544,288 | 2,377,706 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Unsecured short term loan | ' | ' | 1,585,138 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Notes payable | ' | 4,908,216 | 3,170,276 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 818,036 | 3,272,144 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,585,138 | ' | ' | ' | ' | ' | ' | ||||||||||||
Working capital loan drawn from banking facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,072,059 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,585,138 | ' | ' | ' | ' | ' | ' | ||||||||||||
Accounts receivable | ' | 3,327,494 | 2,836,335 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Average short-term borrowing rates | ' | 6.62% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Loan from credit union | ' | 4,253,788 | 1,561,361 | ' | ' | 5,888,198 | 5,730,273 | ' | ' | 1,611,531 | 1,561,361 | ' | 4,302,870 | 4,168,912 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Term of facility and loan payable | ' | ' | ' | ' | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Long-term debt, Interest rate per month | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.72% | ' | ' | 0.72% | 0.72% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Security loan agreement by manufacturing equipment | ' | 22,439,622 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 21,901,456 | 9,316,645 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Current portion of long-term loan from credit union | ' | 1,660,613 | 4,168,912 | ' | ' | ' | ' | ' | ' | 1,611,531 | ' | ' | 49,082 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Interest expense for the short-term bank loans and long-term loans | ' | 828,157 | 736,457 | 495,978 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Total financing proceeds | ' | ' | ' | ' | ' | ' | ' | 24,000,000 | 150,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 24,000,000 | 150,000,000 | ' | ' | ' | ||||||||||||
Proceeds from sale of paper manufacturing equipment to leasing company | ' | 24,215,811 | ' | ' | ' | ' | ' | 24,000,000 | 150,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Nominal purchase price | ' | ' | ' | ' | ' | ' | ' | 2,400 | 15,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,400 | 15,000 | ' | ' | ' | ||||||||||||
Lease service charge | ' | 'Equal to 5.55% of the amount financed. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Implicit interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.15% | 6.15% | ' | ' | ' | ||||||||||||
Stated capital lease | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,750,170 | ' | ' | ' | ' | ||||||||||||
Long-term obligations under capital lease | ' | 12,296,639 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Current obligations under capital lease | ' | 8,264,795 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Deferred gain on sale of leased equipment | ' | 1,160,271 | ' | ' | ' | ' | ' | 1,379,282 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Net values of pledged for sale-leaseback financing | ' | 25,993,677 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Assets pledged for the guarantee of Orient Paper HB's capital lease | ' | 36,134,038 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Value of land use right pledged for sale-leaseback financing | ' | 7,502,794 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,502,794 | ' | ' | ||||||||||||
Land collateral for capital lease | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 58,566 | ' | ' | ||||||||||||
Loan extension period | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Installment repayment description | 'Between December 21, 2013 and July 26, 2018. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Total interest expenses for the sale-leaseback arrangement | ' | 471,472 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
Interest Portion of Minimum Lease Payments, Sale Leaseback Transactions | ' | $1,360,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||
[1] | (a) On September 4, 2012, the Company refinanced with the Industrial & Commercial Bank of China ("ICBC") an accounts receivable factoring facility with a maximum credit limit of $792,568 as of December 31, 2012. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company's books at all times, are not fully collected. The factoring facility carried an interest rate of 6.6% per annum. The Company paid off the principal balance and accrued interest under the factoring facility on August 28, 2013. | ||||||||||||||||||||||||||||||||||||||||||||
[2] | (b) On November 9, 2012, the Company obtained from the ICBC another accounts receivable factoring facility with a maximum credit limit of $1,585,138 as of December 31, 2012. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company's books at all times, are not fully collected. The term of the factoring facility expired on November 8, 2013 and carried an interest rate of 6.6% per annum, or 1.0% plus the prime rate for the loan set forth by the People's Bank of China at the time of funding. The Company paid off the principal balance and accrued interest under the factoring facility on November 8, 2013. | ||||||||||||||||||||||||||||||||||||||||||||
[3] | (d) On September 2, 2013, the Company entered into a working capital loan agreement with the ICBC for $4,090,180, with which $818,036 is payable on June 5, 2014 and $3,272,144 is payable on August 15, 2014. The loan bears an interest rate of 115% over the primary lending rate of the People's Bank of China and was at 6.9% per annum at the time of funding.Concurrent with the signing of the working capital loan agreement, the Company also entered into a trust agreement with the ICBC, which provides trust account management services to the Company during the terms of the underlying loan. The working capital loan is guaranteed by Hebei Fangsheng Real Estate Development Co. Ltd. ("Hebei Fangsheng") with the land use right on our Headquarters Compound pledged by Hebei Fangsheng as collateral for the benefit of the bank. The land use right on our Headquarters Compound was acquired by Hebei Fangsheng from the Company on August 9, 2013 (see Note (11) for the related party transaction). Hebei Fangsheng is controlled by the Company's Chairman and CEO Mr. Zhenyong Liu. | ||||||||||||||||||||||||||||||||||||||||||||
[4] | (e) On September 6, 2013, the Company obtained a new accounts receivable factoring facility from the ICBC for $818,036. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company's books at all times, are not fully collected. The factoring facility will expire on August 4, 2014 and bears an interest rate of 110% of the primary lending rate of the People's Bank of China and was at 6.6% per annum at the time of funding. Concurrent with the signing of the new factoring agreement, the Company also entered into a financial service agreement with ICBC, which provides accounts receivable management services to the Company during the terms of the underlying factoring facility. The factoring facility is personally guaranteed by the Company's Chairman and CEO Mr. Zhenyong Liu. | ||||||||||||||||||||||||||||||||||||||||||||
[5] | (c) On September 19, 2012, the Company obtained from the Bank of Hebei a banking facility with maximum credit limit on bank loans of $1,585,138 and on notes payable of $1,585,138 as of December 31, 2012. The facility was guaranteed by an independent third party. On the same day, the Company drew down from this banking facility a new working capital loan of $1,585,138 as of December 31, 2012. The loan bore interest at the rate of 6.6% per annum. Both the term of the banking facility and loan were for one year and expired on September 19, 2013. The Company paid off the loan balance on September 18, 2013. | ||||||||||||||||||||||||||||||||||||||||||||
[6] | (f) On December 3, 2013, the Company obtained from the ICBC an accounts receivable factoring facility with a maximum credit limit of $1,636,072 as of December 31, 2013. Under the factoring agreement, the bank has recourse against the Company if the receivables, which remain in the Company's books at all times, are not fully collected. The term of the factoring facility expires on October 21, 2014 and carries an interest rate of 6.6% per annum, or 1.0% plus the prime rate for the loan set forth by the People's Bank of China at the time of funding. The unpaid balance of the loan was in the amount of $1,636,072 as of December 31, 2013. |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 0 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||
Aug. 07, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Nov. 30, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Aug. 31, 2009 | Aug. 31, 2009 | Dec. 31, 2013 | Mar. 25, 2014 | |
Apartment | Dormitory | Hebei Fangsheng [Member] | Mr. Zhenyong Liu [Member] | Mr. Zhenyong Liu [Member] | Mr. Zhenyong Liu [Member] | Mr. Zhenyong Liu [Member] | Mr. Zhenyong Liu [Member] | Mr. Zhenyong Liu [Member] | |||
Orient Paper [Member] | Orient Paper HB [Member] | Orient Paper HB [Member] | Subsequent Event [Member] | ||||||||
Related Party Transactions (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loans assumed | ' | ' | ' | ' | ' | ' | ' | ' | $4,000,000 | ' | ' |
Restricted stock award, shares issued | ' | ' | ' | ' | ' | ' | ' | 1,204,341 | ' | ' | ' |
Restricted stock award, Price per share | ' | ' | ' | ' | ' | ' | ' | $3.32 | ' | ' | ' |
Loans payable to related parties | ' | ' | ' | ' | ' | 2,315,239 | 2,389,633 | ' | ' | ' | ' |
Proceeds from shareholder loan | ' | 1,390,802 | 1,030,097 | 200,000 | ' | ' | ' | ' | ' | ' | ' |
Interest rate on loans | ' | ' | ' | ' | ' | 5.85% | ' | ' | ' | 6.15% | ' |
Term of facility and loan payable | ' | ' | ' | ' | ' | '3 years | ' | ' | ' | '3 years | ' |
Loan from related parties, due date | ' | ' | ' | ' | ' | 31-Dec-12 | ' | ' | ' | ' | ' |
Extended maturity date of loans from related party | ' | ' | ' | ' | ' | ' | ' | ' | ' | 31-Dec-15 | ' |
Proceeds earnest money deposit payment from related party | ' | ' | ' | ' | 1,075,606 | ' | ' | ' | ' | ' | ' |
Rental payment | 161,439 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Industrial building lease term | '3 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of apartments sold to qualified employees | 132 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount generated from the sale of Headquarters compound, Industrial building and Dormitories | ' | 84,972 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross profit from sale of assets | ' | 4,130,590 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sale price of industrial land use rights | 2,770,000 | 2,770,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of valuation of land use rights higher than previous appraisal | ' | 3.35% | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sale price of industrial building | 1,150,000 | 1,150,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Value of building | ' | 400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of dormitory buildings | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Original cost of construction of three dormitory buildings | 4,280,000 | 4,280,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Valuation of three dormitory buildings done by valuer | ' | 4,610,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued the rent due to Hebei Fangsheng | ' | 64,546 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Earnest money deposit as a security deposit | ' | 1,636,072 | 1,075,606 | ' | ' | ' | ' | ' | ' | ' | ' |
Loan from related parties, interest expense | ' | 145,015 | 135,377 | 203,914 | ' | ' | ' | ' | ' | ' | ' |
Accrued interest | ' | $946,365 | $656,623 | ' | ' | ' | ' | ' | ' | ' | $566,343 |
Notes_Payable_Details
Notes Payable (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Notes payable (Textual) | ' | ' | ' |
Notes payable | $4,908,216 | $3,170,276 | ' |
Restricted cash | 2,454,108 | 1,585,138 | ' |
Property plant and equipment loan drawn from banking facility | 34,177 | ' | ' |
Short-term bank loans, fixed interest rate | 6.68% | 7.82% | 6.38% |
Bank of Hebei (c) [Member] | ' | ' | ' |
Notes payable (Textual) | ' | ' | ' |
Number of bank acceptance notes | 3 | 6 | ' |
Working capital loan drawn from banking facility | 2,454,108 | 1,585,138 | ' |
Notes payable | 4,908,216 | 3,170,276 | ' |
Restricted cash | 2,454,108 | 1,585,138 | ' |
Property plant and equipment loan drawn from banking facility | $34,177 | ' | ' |
Short-term bank loans, fixed interest rate | ' | ' | ' |
Handling charges of bank acceptance notes percentage | 0.05% | 0.05% | ' |
Other_Payables_and_Accrued_Lia2
Other Payables and Accrued Liabilities (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Summary of other payables and accrued liabilities | ' | ' |
Accrued electricity | $372,726 | $232,763 |
Accrued professional fees | 58,000 | 143,597 |
Value-added tax payable | 940,400 | ' |
Accrued interest to a related party | 566,343 | 406,324 |
Accrued bank loan interest | 380,022 | 250,299 |
Payable for purchase of equipment | ' | 152,173 |
Advance from customer | 11,453 | ' |
Insurance premium payable | 62,348 | 56,773 |
Others | 260,180 | 20,355 |
Totals | $2,651,472 | $1,262,284 |
Common_Stock_Details
Common Stock (Details) (USD $) | 0 Months Ended | 1 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||
Apr. 04, 2013 | Sep. 04, 2012 | Jun. 01, 2012 | Nov. 21, 2013 | Dec. 06, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jan. 12, 2012 | Dec. 31, 2013 | Aug. 28, 2011 | |
Director | 2011 Incentive Stock Plan [Member] | 2011 Incentive Stock Plan [Member] | 2011 Incentive Stock Plan [Member] | ||||||||
Common Stock (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued under incentive stock plan | ' | ' | ' | ' | ' | ' | ' | ' | 109,584 | 297,000 | ' |
Share price | ' | ' | ' | ' | ' | ' | ' | ' | $3.45 | $2.66 | ' |
Number of shares authorized for issuance under stock incentive plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 375,000 |
Total fair value of stock | ' | ' | ' | ' | ' | $790,020 | $378,065 | $30,369 | $378,065 | $790,020 | ' |
Common stock cancelled previously issued to directors | 2,875 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of directors whose shares are cancelled | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Quarterly cash dividend approved | $0.01 | $0.01 | $0.01 | $0.01 | $0.01 | ' | ' | ' | ' | ' | ' |
Reversal of related capital accounts | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' |
Allocated share based compensation expense | ' | ' | ' | ' | ' | 16,155 | ' | ' | ' | ' | ' |
Dividends declared and paid | ' | ' | ' | ' | ' | $323,032 | $692,242 | ' | ' | ' | ' |
Earnings_Per_Share_Details
Earnings Per Share (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Basic income per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income for the year - numerator | $3,520,613 | $5,534,844 | $3,656,136 | $303,055 | $2,001,111 | $4,379,071 | $3,610,790 | $4,681,691 | $13,014,648 | $14,672,663 | $21,648,664 |
Weighted average common stock outstanding - denominator | ' | ' | ' | ' | ' | ' | ' | ' | 18,458,446 | 18,456,781 | 18,349,332 |
Net income per share | $0.19 | $0.30 | $0.02 | $0.02 | $0.11 | $0.24 | $0.20 | $0.25 | $0.71 | $0.79 | $1.18 |
Diluted income per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income for the year - numerator | $3,520,613 | $5,534,844 | $3,656,136 | $303,055 | $2,001,111 | $4,379,071 | $3,610,790 | $4,681,691 | $13,014,648 | $14,672,663 | $21,648,664 |
Weighted average common stock outstanding - denominator | ' | ' | ' | ' | ' | ' | ' | ' | 18,458,446 | 18,456,781 | 18,349,332 |
Effect of dilution | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average common stock outstanding - denominator | ' | ' | ' | ' | ' | ' | ' | ' | 18,458,446 | 18,456,781 | 18,349,332 |
Diluted income per share | $0.19 | $0.30 | $0.02 | $0.02 | $0.11 | $0.24 | $0.20 | $0.25 | $0.71 | $0.79 | $1.18 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Provision for Income Taxes | ' | ' | ' |
Current Tax Provision - PRC | $4,684,870 | $6,406,050 | $7,799,226 |
Deferred Tax Provision - PRC | 409,665 | -941,207 | ' |
Total Provision for Income Taxes | $5,094,535 | $5,464,843 | $7,799,226 |
Income_Taxes_Details_1
Income Taxes (Details 1) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Deferred tax assets (liabilities) - current: | ' | ' |
Depreciation and amortization of property, plant and equipment | $139,805 | ' |
Impairment of property, plant and equipment | 225,656 | ' |
Miscellaneous | 48,076 | ' |
Total deferred tax asset - current, net | 413,537 | ' |
Deferred tax assets (liabilities) - non-current | ' | ' |
Depreciation and amortization of property, plant and equipment | 31,446 | 401,482 |
Impairment of property, plant and equipment | 261,805 | 690,916 |
Miscellaneous | -24,922 | -150,742 |
Net Operating Loss Carryover for U.S. income tax purposes | 1,445,755 | 2,303,851 |
Total deferred tax assets - non-current | 1,714,084 | 3,245,507 |
Less: Valuation allowance | -1,445,755 | -2,303,851 |
Total deferred tax assets - non-current, net | $268,329 | $941,656 |
Income_Taxes_Details_2
Income Taxes (Details 2) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Reconciliation of statutory rates to Company's effective tax rate | ' | ' | ' |
PRC Statutory rate | 25.00% | 25.00% | 25.00% |
Effect of different tax jurisdiction | -1.10% | -0.60% | -0.60% |
Effect of expenses not deductible for PRC tax purposes | 1.50% | ' | 0.10% |
Effect of income not taxable for PRC tax purposes | ' | 0.30% | -0.30% |
Under provision in previous year | ' | ' | 0.10% |
Change in valuation allowance | 2.70% | 2.40% | 2.20% |
Effective income tax rate | 28.10% | 27.10% | 26.50% |
Income_Taxes_Details_Textual
Income Taxes (Details Textual) (USD $) | 12 Months Ended | 0 Months Ended | 1 Months Ended | 12 Months Ended | |||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Apr. 04, 2013 | Nov. 21, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
United States [Member] | PRC [Member] | PRC [Member] | PRC [Member] | PRC [Member] | PRC [Member] | ||||
Income Taxes (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Statutory tax rate | 25.00% | 25.00% | 25.00% | 34.00% | ' | ' | 25.00% | ' | ' |
State tax rate | ' | ' | ' | 0.00% | ' | ' | ' | ' | ' |
Cumulative undistributed earnings of foreign subsidiaries | ' | ' | ' | ' | ' | ' | $100,959,070 | $86,287,945 | ' |
First record date of dividend | ' | ' | ' | ' | 16-Apr-13 | 29-Nov-13 | ' | ' | ' |
Quarterly dividends Payable, Amount Per Share | ' | ' | ' | ' | $0.01 | ' | ' | ' | ' |
Quarterly cash dividend declared by Board of Directors | ' | ' | ' | ' | ' | $0.01 | ' | ' | ' |
Expected aggregate cash dividends payable for four quarters | ' | ' | ' | ' | ' | ' | 373,593 | ' | ' |
Ordinary tax deductions and accumulated Net Operating Losses (NOLs) | ' | ' | ' | ' | ' | ' | 4,252,220 | ' | ' |
Income tax, statute of limitations period | '5 years | ' | ' | ' | ' | ' | ' | ' | ' |
Accumulated Net Operating Losses (NOLs), for U.S. income tax purposes | ' | ' | ' | ' | ' | ' | $4,252,220 | $3,148,622 | $2,230,753 |
Operating loss carry forwards, Expiration date | ' | ' | ' | ' | ' | ' | 31-Dec-33 | ' | ' |
Percentage of valuation allowance on the U.S. deferred tax asset benefit | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' |
Stock_Incentive_Plans_Details
Stock Incentive Plans (Details) | 0 Months Ended | 12 Months Ended | 12 Months Ended | ||
Jan. 12, 2012 | Dec. 31, 2013 | Aug. 28, 2011 | Dec. 31, 2013 | Sep. 10, 2012 | |
2011 Incentive Stock Plan [Member] | 2011 Incentive Stock Plan [Member] | 2011 Incentive Stock Plan [Member] | 2012 incentive stock plan [Member] | 2012 incentive stock plan [Member] | |
Stock Incentive Plans (Textual) | ' | ' | ' | ' | ' |
Number of shares authorized for issuance under stock incentive plan | ' | ' | 375,000 | ' | 200,000 |
Shares issued under incentive stock plan | 109,584 | 297,000 | ' | 31,584 | ' |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | Dec. 31, 2013 |
Schedule of future minimum lease payments | ' |
2014 | $707,680 |
2015 | 772,226 |
2016 | 772,226 |
2017 | 608,619 |
2018 | 608,619 |
Thereafter | 4,967,114 |
Total operating lease payments | $8,436,484 |
Commitments_and_Contingencies_2
Commitments and Contingencies (Details Textual) | 12 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Nov. 27, 2012 | Nov. 27, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | |
USD ($) | USD ($) | Minimum [Member] | Maximum [Member] | Land use rights [Member] | Land use rights [Member] | Local government, Xushui County [Member] | Local government, Xushui County [Member] | Investment Company [Member] | Investment Company [Member] | Hebei Fangsheng [Member] | Hebei Fangsheng [Member] | |
USD ($) | USD ($) | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | |||||
acre | acre | |||||||||||
Commitments and Contingencies (Textual) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Area of land leased | ' | ' | ' | ' | ' | ' | 32.95 | 32.95 | 49.4 | 49.4 | ' | ' |
Lease expiration period | ' | ' | ' | ' | ' | ' | '30 years | '30 years | '15 years | '15 years | '3 years | '3 years |
Lease expiration date | ' | ' | ' | ' | ' | ' | 31-Dec-31 | 31-Dec-31 | ' | ' | ' | ' |
Operating lease annual rental payment | ' | ' | ' | ' | ' | ' | $19,633 | 120,000 | $588,986 | 3,600,000 | $163,607 | 1,000,000 |
Operating lease renewable term | ' | ' | ' | ' | ' | ' | 'Orient Paper leases 32.95 acres of land from a local government in Xushui County, Baoding City, Hebei, China through a real estate lease with a 30-year term | 'Orient Paper leases 32.95 acres of land from a local government in Xushui County, Baoding City, Hebei, China through a real estate lease with a 30-year term | ' | ' | ' | ' |
Orient Paper entered into a 49.4 acres land lease with an investment company in the Economic Development Zone in Wei County, Hebei, China. The lease term of the Wei County land lease commences on the date of the lease and lasts for 15 years. | Orient Paper entered into a 49.4 acres land lease with an investment company in the Economic Development Zone in Wei County, Hebei, China. The lease term of the Wei County land lease commences on the date of the lease and lasts for 15 years. | |||||||||||
Land use right pledged for long term loan | 21,901,456 | 9,316,645 | ' | ' | ' | 7,419,614 | ' | ' | ' | ' | ' | ' |
Performance holdback on new tissue paper, percentage | ' | ' | 5.00% | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding commitments for construction of equipment and facilities | 51,673,158 | 5,243,636 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Performance holdback on new tissue paper payment, description | 'Exception of a 5%-10% performance holdback on the construction of equipment and facilities is payable in 2014 and 2015, the Company expected to pay off all the balances by the end of year 2014. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Settlement agreement, consideration | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cross guarantee for long term loan of third party | ' | $1,585,138 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long term loan of third party expiration date | ' | 3-Jun-13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment_Reporting_Details
Segment Reporting (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Summarized financial information for reportable segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | $35,246,348 | $37,686,114 | $33,038,512 | $19,746,656 | $43,534,781 | $37,651,354 | $35,521,672 | $34,408,999 | $125,717,630 | $151,116,806 | $150,747,316 |
Gross Profit | 7,161,153 | 8,435,814 | 6,098,395 | 1,630,237 | 6,697,358 | 6,820,053 | 5,785,664 | 7,753,172 | 23,325,599 | 27,056,247 | 32,950,075 |
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 7,794,743 | 8,382,859 | 4,424,531 |
Impairment | ' | ' | ' | ' | ' | ' | ' | ' | ' | -2,762,349 | ' |
Interest income | ' | ' | ' | ' | ' | ' | ' | ' | 90,260 | 30,674 | 36,437 |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | 995,694 | 871,834 | 699,892 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 5,094,535 | 5,464,843 | 7,799,226 |
Net Income (Loss) | 3,520,613 | 5,534,844 | 3,656,136 | 303,055 | 2,001,111 | 4,379,071 | 3,610,790 | 4,681,691 | 13,014,648 | 14,672,663 | 21,648,664 |
Total Assets | 209,526,202 | ' | ' | ' | 162,846,324 | ' | ' | ' | 209,526,202 | 162,846,324 | ' |
Orient Paper HB [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Summarized financial information for reportable segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | 120,747,633 | 144,928,792 | 142,498,116 |
Gross Profit | ' | ' | ' | ' | ' | ' | ' | ' | 22,318,739 | 25,616,670 | 30,191,480 |
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 6,828,970 | 6,553,120 | 3,504,717 |
Impairment | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,762,349 | ' |
Interest income | ' | ' | ' | ' | ' | ' | ' | ' | 86,168 | 25,950 | 20,847 |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | 995,694 | 867,561 | 699,892 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 4,845,970 | 5,129,304 | 7,136,886 |
Net Income (Loss) | ' | ' | ' | ' | ' | ' | ' | ' | 14,604,244 | 15,109,345 | 21,527,824 |
Total Assets | 168,149,877 | ' | ' | ' | 119,707,195 | ' | ' | ' | 168,149,877 | 119,707,195 | ' |
Orient Paper Shengde [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Summarized financial information for reportable segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | 4,969,997 | 6,188,014 | 8,249,200 |
Gross Profit | ' | ' | ' | ' | ' | ' | ' | ' | 1,006,860 | 1,439,577 | 2,758,595 |
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 965,773 | 1,829,739 | 919,814 |
Impairment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest income | ' | ' | ' | ' | ' | ' | ' | ' | 4,009 | 4,634 | 15,273 |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 248,565 | 335,539 | 662,340 |
Net Income (Loss) | ' | ' | ' | ' | ' | ' | ' | ' | 638,031 | 965,444 | 1,961,694 |
Total Assets | 41,264,704 | ' | ' | ' | 43,076,428 | ' | ' | ' | 41,264,704 | 43,076,428 | ' |
Not Attributable to Segments [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Summarized financial information for reportable segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross Profit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impairment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest income | ' | ' | ' | ' | ' | ' | ' | ' | 83 | 90 | 317 |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,273 | ' |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Income (Loss) | ' | ' | ' | ' | ' | ' | ' | ' | -2,227,627 | -1,402,126 | -1,840,854 |
Total Assets | 111,621 | ' | ' | ' | 62,701 | ' | ' | ' | 111,621 | 62,701 | ' |
Elimination of Inter-segment [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Summarized financial information for reportable segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross Profit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impairment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest income | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Income (Loss) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total Assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Enterprise-wide, consolidated [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Summarized financial information for reportable segments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | 125,717,630 | 151,116,806 | 150,747,316 |
Gross Profit | ' | ' | ' | ' | ' | ' | ' | ' | 23,325,599 | 27,056,247 | 32,950,075 |
Depreciation and amortization | ' | ' | ' | ' | ' | ' | ' | ' | 7,794,743 | 8,382,859 | 4,424,531 |
Impairment | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,762,349 | ' |
Interest income | ' | ' | ' | ' | ' | ' | ' | ' | 90,260 | 30,674 | 36,437 |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | 995,694 | 871,834 | 699,892 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 5,094,535 | 5,464,843 | 7,799,226 |
Net Income (Loss) | ' | ' | ' | ' | ' | ' | ' | ' | 13,014,648 | 14,672,663 | 21,648,664 |
Total Assets | $209,526,202 | ' | ' | ' | $162,846,324 | ' | ' | ' | $209,526,202 | $162,846,324 | ' |
Segment_Reporting_Details_Text
Segment Reporting (Details Textual) | 12 Months Ended |
Dec. 31, 2013 | |
Segments | |
Segment Reporting (Textual) | ' |
Number of business operating segments | 2 |
Number of reportable segment | 2 |
Concentration_and_Major_Custom1
Concentration and Major Customers and Suppliers (Details) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Supplier | Customer | Customer | |
Customer | Supplier | Supplier | |
Concentration and major customers and suppliers (Textual) | ' | ' | ' |
Number of major suppliers | 3 | 2 | 3 |
Number of customer contributed over 10% of total sales | ' | ' | ' |
Supplier A [Member] | ' | ' | ' |
Concentration and major customers and suppliers (Textual) | ' | ' | ' |
Percentage of revenue from Orient Paper HB | 75.00% | 77.00% | 61.00% |
Supplier B [Member] | ' | ' | ' |
Concentration and major customers and suppliers (Textual) | ' | ' | ' |
Percentage of revenue from Orient Paper HB | 10.00% | 8.00% | 11.00% |
Supplier C [Member] | ' | ' | ' |
Concentration and major customers and suppliers (Textual) | ' | ' | ' |
Percentage of revenue from Orient Paper HB | 7.00% | ' | 6.00% |
Subsequent_Event_Details
Subsequent Event (Details) (Subsequent Event [Member], USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Industrial & Commercial Bank of China [Member] | ' |
Subsequent Event [Line Items] | ' |
Line of credit facility, maximum borrowing capacity | $24,500,000 |
Working capital loans | 6,500,000 |
Additional line of credit facility, borrowing capacity | 18,000,000 |
Shanghai Pudong Development Bank [Member] | ' |
Subsequent Event [Line Items] | ' |
Line of credit facility, maximum borrowing capacity | $3,300,000 |
Line of credit facility, initiation date | 3-Mar-14 |
Line of credit facility, expiration date | 12-Jan-15 |
Summarized_Quarterly_Financial2
Summarized Quarterly Financial Data (Unaudited) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Summary of quarterly financial information | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | $35,246,348 | $37,686,114 | $33,038,512 | $19,746,656 | $43,534,781 | $37,651,354 | $35,521,672 | $34,408,999 | $125,717,630 | $151,116,806 | $150,747,316 |
Gross Profit | 7,161,153 | 8,435,814 | 6,098,395 | 1,630,237 | 6,697,358 | 6,820,053 | 5,785,664 | 7,753,172 | 23,325,599 | 27,056,247 | 32,950,075 |
Income from Operations | 5,325,060 | 7,563,522 | 5,211,839 | 743,071 | 3,009,214 | 6,161,418 | 5,099,534 | 6,708,500 | 18,843,492 | 20,978,666 | 30,111,345 |
Net income | $3,520,613 | $5,534,844 | $3,656,136 | $303,055 | $2,001,111 | $4,379,071 | $3,610,790 | $4,681,691 | $13,014,648 | $14,672,663 | $21,648,664 |
Net income per share: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basic | $0.19 | $0.30 | $0.02 | $0.02 | $0.11 | $0.24 | $0.20 | $0.25 | $0.71 | $0.79 | $1.18 |
Diluted | $0.19 | $0.30 | $0.02 | $0.02 | $0.11 | $0.24 | $0.20 | $0.25 | $0.71 | $0.79 | $1.18 |
Condensed_Financial_Informatio2
Condensed Financial Information of the Parent Company (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Current Assets | ' | ' | ' | ' |
Cash and cash equivalents | $3,131,163 | $13,140,288 | $4,165,446 | $11,348,108 |
Prepayments and other current assets | 1,068,031 | 5,401,705 | ' | ' |
Total current assets | 25,953,328 | 38,067,567 | ' | ' |
Total Assets | 209,526,202 | 162,846,324 | ' | ' |
Current Liabilities | ' | ' | ' | ' |
Bank overdraft | ' | ' | ' | ' |
Accrued payroll and employee benefits | 498,010 | 292,638 | ' | ' |
Insurance premium payable | 62,348 | 56,773 | ' | ' |
Total current liabilities | 28,372,723 | 16,200,923 | ' | ' |
Total liabilities | 48,473,054 | 20,077,523 | ' | ' |
Total stockholders' equity | 161,053,148 | 142,768,801 | 127,525,443 | 101,542,076 |
Total Liabilities and Stockholders' Equity | 209,526,202 | 162,846,324 | ' | ' |
Orient Paper [Member] | ' | ' | ' | ' |
Current Assets | ' | ' | ' | ' |
Cash and cash equivalents | 42,592 | -96 | 145,386 | 69,849 |
Prepayments and other current assets | 69,029 | 62,797 | ' | ' |
Total current assets | 111,621 | 62,797 | ' | ' |
Investment in subsidiaries | 163,658,397 | 143,597,251 | ' | ' |
Total Assets | 163,770,018 | 143,660,048 | ' | ' |
Current Liabilities | ' | ' | ' | ' |
Bank overdraft | ' | 96 | ' | ' |
Inter-company payable | 2,544,855 | 736,378 | ' | ' |
Accrued payroll and employee benefits | 51,667 | 40,000 | ' | ' |
Accrued liabilities | 58,000 | 58,000 | ' | ' |
Insurance premium payable | 62,348 | 56,773 | ' | ' |
Total current liabilities | 2,716,870 | 891,247 | ' | ' |
Total liabilities | 2,716,870 | 891,247 | ' | ' |
Total stockholders' equity | 161,053,148 | 142,768,801 | ' | ' |
Total Liabilities and Stockholders' Equity | $163,770,018 | $143,660,048 | ' | ' |
Condensed_Financial_Informatio3
Condensed Financial Information of the Parent Company (Details 1) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Selling, General and Administrative Expenses | ' | ' | ' | ' | ' | ' | ' | ' | $4,567,079 | $3,360,520 | $2,517,530 |
Loss from Operations | 5,325,060 | 7,563,522 | 5,211,839 | 743,071 | 3,009,214 | 6,161,418 | 5,099,534 | 6,708,500 | 18,843,492 | 20,978,666 | 30,111,345 |
Other Income (Expense) | 5,325,060 | 7,563,522 | 5,211,839 | 743,071 | 3,009,214 | 6,161,418 | 5,099,534 | 6,708,500 | 18,843,492 | 20,978,666 | 30,111,345 |
Income before Income Taxes | ' | ' | ' | ' | ' | ' | ' | ' | 18,109,183 | 20,137,506 | 29,447,890 |
Provision for Income Taxes | ' | ' | ' | ' | ' | ' | ' | ' | 5,094,535 | 5,464,843 | 7,799,226 |
Net income | 3,520,613 | 5,534,844 | 3,656,136 | 303,055 | 2,001,111 | 4,379,071 | 3,610,790 | 4,681,691 | 13,014,648 | 14,672,663 | 21,648,664 |
Orient Paper [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Selling, General and Administrative Expenses | ' | ' | ' | ' | ' | ' | ' | ' | 2,227,711 | 1,397,943 | 1,841,171 |
Loss from Operations | ' | ' | ' | ' | ' | ' | ' | ' | -2,227,711 | -1,397,943 | -1,841,171 |
Equity in earnings of unconsolidated subsidiaries | ' | ' | ' | ' | ' | ' | ' | ' | 15,242,276 | 16,074,789 | 23,489,518 |
Other Income (Expense) | ' | ' | ' | ' | ' | ' | ' | ' | 83 | -4,183 | 317 |
Income before Income Taxes | ' | ' | ' | ' | ' | ' | ' | ' | 13,014,648 | 14,672,663 | 21,648,664 |
Provision for Income Taxes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | ' | ' | ' | ' | ' | ' | ' | ' | $13,014,648 | $14,672,663 | $21,648,664 |
Condensed_Financial_Informatio4
Condensed Financial Information of the Parent Company (Details 2) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
CONDENSED STATEMENTS OF CASH FLOWS | ' | ' | ' |
Net Cash Provided by (Used in) Operating Activities | $29,921,941 | $22,231,966 | $18,630,049 |
Net Cash Used in Investing Activities | -60,362,479 | -11,915,693 | -27,451,405 |
Net Cash Used in Financing Activities | 20,100,686 | -1,367,557 | 1,496,791 |
Net Increase (Decrease) in Cash and Cash Equivalents | -10,009,125 | 8,974,842 | -7,182,662 |
Cash and Cash Equivalents - Beginning of Period | 13,140,288 | 4,165,446 | 11,348,108 |
Cash and Cash Equivalents - End of Period | 3,131,163 | 13,140,288 | 4,165,446 |
Parent Company [Member] | ' | ' | ' |
CONDENSED STATEMENTS OF CASH FLOWS | ' | ' | ' |
Net Cash Provided by (Used in) Operating Activities | 365,720 | 546,760 | 75,537 |
Net Cash Used in Investing Activities | ' | ' | ' |
Net Cash Used in Financing Activities | -323,032 | -692,242 | ' |
Net Increase (Decrease) in Cash and Cash Equivalents | 42,688 | -145,482 | 75,537 |
Cash and Cash Equivalents - Beginning of Period | -96 | 145,386 | 69,849 |
Cash and Cash Equivalents - End of Period | $42,592 | ($96) | $145,386 |