Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Mar. 07, 2019 | Jun. 30, 2018 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | IT TECH PACKAGING, INC. | ||
Entity Central Index Key | 1,358,190 | ||
Trading Symbol | ITP | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,018 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Shell Company | false | ||
Entity Small Business | true | ||
Entity Ex Transition Period | false | ||
Entity Emerging Growth Company | false | ||
Entity Public Float | $ 16,010,829 | ||
Entity Common Stock, Shares Outstanding | 22,022,316 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Current Assets | ||
Cash and bank balances | $ 8,474,809 | $ 2,895,790 |
Restricted cash | 3,642,616 | 6,121,637 |
Accounts receivable (net of allowance for doubtful accounts of $58,707 and $37,626 as of December 31, 2018 and December 2017, respectively) | 2,876,632 | 1,843,682 |
Inventories | 2,923,516 | 8,474,165 |
Prepayments and other current assets | 6,241,299 | 651,523 |
Total current assets | 24,158,872 | 19,986,797 |
Property, plant, and equipment, net | 167,829,716 | 189,388,709 |
Value-added tax recoverable | 2,810,331 | 3,041,416 |
Deferred tax asset non-current | 8,277,091 | 6,572,559 |
Total Assets | 203,076,010 | 218,989,481 |
Current Liabilities | ||
Short-term bank loans | 11,802,075 | 7,192,923 |
Current portion of long-term loans from credit union | 2,491,549 | 6,366,502 |
Accounts payable | 629,054 | 422,705 |
Notes payable | 3,642,616 | 6,121,637 |
Due to related parties | 413,336 | 60,378 |
Accrued payroll and employee benefits | 213,536 | 231,247 |
Other payables and accrued liabilities | 10,222,796 | 836,337 |
Income taxes payable | 219,305 | 525,804 |
Total current liabilities | 29,634,267 | 21,757,533 |
Loans from credit union | 4,706,259 | 1,193,719 |
Loans from a related party | 2,185,569 | 10,712,865 |
Total liabilities (including amounts of the consolidated VIE without recourse to the Company of $34,008,908 and $31,235,520 as of December 31, 2018 and 2017, respectively) | 36,526,095 | 33,664,117 |
Commitments and Contingencies | ||
Stockholders' Equity | ||
Common stock, 500,000,000 shares authorized, $0.001 par value per share, 20,022,316 and 21,450,316 shares issued and outstanding as of December 31, 2018 and 2017, respectively | 22,360 | 21,450 |
Additional paid-in capital | 51,137,319 | 50,635,243 |
Statutory earnings reserve | 6,080,574 | 6,080,574 |
Accumulated other comprehensive (loss) income | (3,263,952) | 5,468,799 |
Retained earnings | 112,573,614 | 123,119,298 |
Total stockholders' equity | 166,549,915 | 185,325,364 |
Total Liabilities and Stockholders' Equity | $ 203,076,010 | $ 218,989,481 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 58,707 | $ 37,626 |
Consolidated VIE, liabilities | $ 34,008,908 | $ 31,235,520 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares issued | 20,022,316 | 21,450,316 |
Common stock, shares outstanding | 20,022,316 | 21,450,316 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income (Loss) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | ||
Revenues | $ 86,746,758 | $ 117,023,578 |
Cost of sales | (80,926,357) | (97,067,627) |
Gross Profit | 5,820,401 | 19,955,951 |
Selling, general and administrative expenses | (13,098,373) | (11,307,395) |
Loss from disposal of property, plant and equipment | (9,881) | (1,677,262) |
Loss on impairment of assets | (3,894,461) | (2,291,027) |
(Loss) Income from Operations | (11,182,314) | 4,680,267 |
Other Income (Expense): | ||
Interest income | 36,632 | 34,590 |
Subsidy income | 241,189 | 41,529 |
Interest expense | (1,492,119) | (2,433,770) |
(Loss) Income before Income Taxes | (12,396,612) | 2,322,616 |
Provision for Income Taxes | 1,850,928 | (662,828) |
Net (Loss) Income | (10,545,684) | 1,659,788 |
Other Comprehensive (Loss) Income | ||
Foreign currency translation adjustment | (8,732,751) | 10,910,190 |
Total Comprehensive (Loss) Income | $ (19,278,435) | $ 12,569,978 |
(Losses) Earnings Per Share: | ||
Basic and Diluted (Losses) Earnings per Share | $ (0.49) | $ 0.08 |
Outstanding - Basic and Diluted | 21,618,305 | 21,450,316 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) | Common Stock | Additional Paid-In Capital | Statutory Earnings Reserve | Accumulated Other Comprehensive Income (loss) | Retained Earnings | Total |
Balance at Dec. 31, 2016 | $ 21,450 | $ 50,635,243 | $ 6,080,574 | $ (5,441,391) | $ 121,459,510 | $ 172,755,386 |
Balance, Shares at Dec. 31, 2016 | 21,450,316 | |||||
Foreign currency translation adjustment | 10,910,190 | 10,910,190 | ||||
Net income loss for the year | 1,659,788 | 1,659,788 | ||||
Balance at Dec. 31, 2017 | $ 21,450 | 50,635,243 | 6,080,574 | 5,468,799 | 123,119,298 | 185,325,364 |
Balance, Shares at Dec. 31, 2017 | 21,450,316 | |||||
Issuance of shares to officer and directors | $ 535 | 469,826 | 470,361 | |||
Issuance of shares to officer and directors, shares | 534,500 | |||||
Issuance of shares to Weitian | $ 375 | 32,250 | 32,625 | |||
Issuance of shares to Weitian, shares | 37,500 | |||||
Foreign currency translation adjustment | (8,732,751) | (8,732,751) | ||||
Net income loss for the year | (10,545,684) | (10,545,684) | ||||
Balance at Dec. 31, 2018 | $ 22,360 | $ 51,137,319 | $ 6,080,574 | $ (3,263,952) | $ 112,573,614 | $ 166,549,915 |
Balance, Shares at Dec. 31, 2018 | 22,022,316 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Cash Flows from Operating Activities: | ||
Net income | $ (10,545,684) | $ 1,659,788 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 14,290,919 | 14,633,780 |
Loss from disposal and impairment of property, plant and equipment | 4,524,581 | 3,968,289 |
(Recovery from) Allowance for bad debts | 23,676 | (45,309) |
Share-based compensation expenses | 470,361 | |
Deferred tax | (2,089,439) | (3,010,577) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (1,183,782) | 2,265,428 |
Prepayments and other current assets | (5,726,546) | (79,264) |
Inventories | 5,322,320 | (2,417,942) |
Accounts payable | 234,448 | (166,464) |
Advance from customers | (29,663) | |
Notes payable | (2,261,147) | 3,707,933 |
Due to related parties | 150,743 | |
Accrued payroll and employee benefits | (6,855) | 8,111 |
Other payables and accrued liabilities | 6,878,137 | (1,503,275) |
Income taxes payable | (291,119) | (839,047) |
Net Cash Provided by Operating Activities | 9,790,613 | 18,151,788 |
Cash Flows from Investing Activities: | ||
Purchases of property, plant and equipment | (2,198,852) | (9,380,702) |
Proceeds from sale of property, plant and equipment | 59,066 | |
Net Cash Used in Investing Activities | (2,198,852) | (9,321,636) |
Cash Flows from Financing Activities: | ||
Proceeds from related party loans | 4,522,295 | |
Repayments of related party loans | (12,813,169) | |
Proceeds from short term bank loans | 12,210,196 | 12,903,609 |
Repayment of bank loans | (12,149,899) | (11,153,463) |
Proceeds from credit union loans | 5,064,970 | 2,373,077 |
Payment of capital lease obligation | (9,040,260) | |
Net Cash Used in Financing Activities | (3,165,607) | (4,917,037) |
Effect of Exchange Rate Changes on Cash and Cash Equivalents | (1,326,156) | 609,348 |
Net Increase (Decrease) in Cash and Cash Equivalents | 3,099,998 | 4,522,463 |
Cash, Cash Equivalents and Restricted Cash - Beginning of Year | 9,017,427 | 4,494,964 |
Cash, Cash Equivalents and Restricted Cash - End of Year | 12,117,425 | 9,017,427 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash paid for interest, net of capitalized interest cost | 1,866,093 | 1,359,343 |
Cash paid for income taxes | 515,001 | 3,247,406 |
Cash and bank balances | 8,474,809 | 2,895,790 |
Restricted cash | 3,642,616 | 6,121,637 |
Total cash, cash equivalents and restricted cash shown in the statement of cash flows | $ 12,117,425 | $ 9,017,427 |
Organization and Business Backg
Organization and Business Background | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business Background | (1) Organization and Business Background IT Tech Packaging, Inc. (the Company) was incorporated in the State of Nevada on December 9, 2005, under the name “Carlateral, Inc.” Through the steps described immediately below, we became the holding company for Hebei Baoding Dongfang Paper Milling Company Limited (“Dongfang Paper”), a producer and distributor of paper products in China, on October 29, 2007, and effective December 21, 2007, we changed our name to “Orient Paper, Inc.”. Effective on August 1, 2018, we changed our corporate name to IT Tech Packaging, Inc.. The name change was effected through a parent/subsidiary short-form merger of IT Tech Packaging, Inc., our wholly-owned Nevada subsidiary formed solely for the purpose of the name change, with and into us. We were the surviving entity. In connection with the name change, our common stock began being traded under a new NYSE symbol, “ITP,” and a new CUSIP number, 46527C100, at such time. On October 29, 2007, pursuant to an agreement and plan of merger (the “Merger Agreement”), the Company acquired Dongfang Zhiye Holding Limited (“Dongfang Holding”), a corporation formed on November 13, 2006 under the laws of the British Virgin Islands, and issued the shareholders of Dongfang Holding an aggregate of 7,450,497 (as adjusted for a four-for-one reverse stock split effected in November 2009) shares of our common stock, which shares were distributed pro-rata to the shareholders of Dongfang Holding in accordance with their respective ownership interests in Dongfang Holding. At the time of the Merger Agreement, Dongfang Holding owned all of the issued and outstanding stock and ownership of Dongfang Paper and such shares of Dongfang Paper were held in trust with Zhenyong Liu, Xiaodong Liu and Shuangxi Zhao, for Mr. Liu, Mr. Liu and Mr. Zhao (the original shareholders of Dongfang Paper) to exercise control over the disposition of Dongfang Holding’s shares in Dongfang Paper on Dongfang Holding’s behalf until Dongfang Holding successfully completed the change in registration of Dongfang Paper’s capital with the relevant PRC Administration of Industry and Commerce as the 100% owner of Dongfang Paper’s shares. As a result of the merger transaction, Dongfang Holding became a wholly owned subsidiary of the Company, and Dongfang Holding’s wholly owned subsidiary, Dongfang Paper, became an indirectly owned subsidiary of the Company. Dongfang Holding, as the 100% owner of Dongfang Paper, was unable to complete the registration of Dongfang Paper’s capital under its name within the proper time limits set forth under PRC law. In connection with the consummation of the restructuring transactions described below, Dongfang Holding directed the trustees to return the shares of Dongfang Paper to their original shareholders, and the original Dongfang Paper shareholders entered into certain agreements with Baoding Shengde Paper Co., Ltd. (“Baoding Shengde”) to transfer the control of Dongfang Paper over to Baoding Shengde. On June 24, 2009, the Company consummated a number of restructuring transactions pursuant to which it acquired all of the issued and outstanding shares of Shengde Holdings Inc, a Nevada corporation. Shengde Holdings Inc was incorporated in the State of Nevada on February 25, 2009. On June 1, 2009, Shengde Holdings Inc incorporated Baoding Shengde, a limited liability company organized under the laws of the PRC. Because Baoding Shengde is a wholly-owned subsidiary of Shengde Holdings Inc, it is regarded as a wholly foreign-owned entity under PRC law. To ensure proper compliance of the Company’s control over the ownership and operations of Dongfang Paper with certain PRC regulations, on June 24, 2009, the Company entered into a series of contractual agreements (the “Contractual Agreements”) with Dongfang Paper and Dongfang Paper Equity Owners via the Company’s wholly owned subsidiary Shengde Holdings Inc (“Shengde Holdings”) a Nevada corporation and Baoding Shengde Paper Co., Ltd. (“Baoding 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). Baoding 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 Baoding Shengde shall provide exclusive technical, business and management consulting services to Dongfang Paper, in exchange for service fees including a fee equivalent to 80% of Dongfang Paper’s total annual net profits; (ii) Loan Agreement, which provides that Baoding Shengde will make a loan in the aggregate principal amount of $10,000,000 to Dongfang Paper Equity Owners in exchange for each such shareholder agreeing to contribute all of its proceeds from the loan to the registered capital of Dongfang Paper; (iii) Call Option Agreement, which generally provides, among other things, that Dongfang Paper Equity Owners irrevocably grant to Baoding Shengde an option to purchase all or part of each owner’s equity interest in Dongfang Paper. The exercise price for the options shall be RMB1 which Baoding Shengde should pay to each of Dongfang Paper Equity Owner for all their equity interests in Dongfang Paper; (iv) Share Pledge Agreement, which provides that Dongfang Paper Equity Owners will pledge all of their equity interests in Dongfang Paper to Baoding Shengde as security for their obligations under the other agreements described in this section. Specifically, Baoding Shengde is entitled to dispose of the pledged equity interests in the event that Dongfang Paper Equity Owners breach their obligations under the Loan Agreement or Dongfang Paper fails to pay the service fees to Baoding Shengde pursuant to the Exclusive Technical Service and Business Consulting Agreement; and (v) Proxy Agreement, which provides that Dongfang Paper Equity Owners shall irrevocably entrust a designee of Baoding 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 Dongfang Paper or with respect to any equity owner action to be taken in accordance with the laws and Dongfang Paper’s Articles of Association. The terms of the agreement are binding on the parties for as long as Dongfang Paper Equity Owners continue to hold any equity interest in Dongfang Paper. A Dongfang Paper Equity Owner will cease to be a party to the agreement once it transfers its equity interests with the prior approval of Baoding Shengde. As the Company had controlled Dongfang Paper since July 16, 2007 through Dongfang Holding and the trust until June 24, 2009, and continues to control Dongfang Paper through Baoding Shengde and the Contractual Agreements, the execution of the Contractual Agreements is considered as a business combination under common control. On February 10, 2010, Baoding Shengde and the Dongfang Paper Equity Owners entered into a Termination of Loan Agreement to terminate the above-mentioned $10,000,000 Loan Agreement. Because of the Company’s decision to fund future business expansions through Baoding Shengde instead of Dongfang Paper, 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 Dongfang Paper and its businesses in the PRC. An agreement was also entered into among Baoding Shengde, Dongfang Paper and the Dongfang Paper Equity Owners on December 31, 2010, reiterating that Baoding Shengde is entitled to 100% of the distributable profit of Dongfang Paper, pursuant to the above mentioned Contractual Agreements. In addition, Dongfang Paper and the Dongfang Paper Equity Owners shall not declare any of Dongfang Paper’s unappropriated earnings as dividend, including the unappropriated earnings of Dongfang Paper from its establishment to 2010 and thereafter. The Company has no direct equity interest in Dongfang Paper. However, through the Contractual Agreements described above, the Company is found to be the primary beneficiary (the “Primary Beneficiary”) of Dongfang Paper and is deemed to have the effective control over Dongfang Paper’s activities that most significantly affect its economic performance, resulting in Dongfang Paper being treated as a controlled variable interest entity of the Company in accordance with Topic 810 - Consolidation of the Accounting Standards Codification (the “ASC”) issued by the Financial Accounting Standard Board (the “FASB”). The revenue generated from Dongfang Paper for the years ended December 31, 2018 and 2017 was accounted for 99.98% and 100% of the Company’s total revenue, respectively. Dongfang Paper also accounted for 90.60% and 87.96% of the total assets of the Company as of December 31, 2018 and 2017, respectively. As of December 31, 2018 and 2017, details of the Company’s subsidiaries and variable interest entity are as follows: Date of Incorporation Place of Incorporation or Percentage of Name or Establishment Establishment Ownership Principal Activity Subsidiary: Dongfang Holding November 13, 2006 BVI 100 % Inactive investment holding Shengde Holdings February 25, 2009 State of Nevada 100 % Investment holding Baoding Shengde June 1, 2009 PRC 100 % Paper production and distribution Variable interest entity (“VIE”): Dongfang Paper March 10, 1996 PRC Control * Paper production and distribution * Dongfang Paper is treated as a 100% controlled variable interest entity of the Company. However, uncertainties in the PRC legal system could cause the Company’s current ownership structure to be found to be in violation of any existing and/or future PRC laws or regulations and could limit the Company’s ability, through its subsidiary, to enforce its rights under these contractual arrangements. Furthermore, shareholders of the VIE may have interests that are different than those of the Company, which could potentially increase the risk that they would seek to act contrary to the terms of the aforementioned agreements. In addition, if the current structure or any of the contractual arrangements were found to be in violation of any existing or future PRC law, the Company may be subject to penalties, which may include, but not be limited to, the cancellation or revocation of the Company’s business and operating licenses, being required to restructure the Company’s operations or being required to discontinue the Company’s operating activities. The imposition of any of these or other penalties may result in a material and adverse effect on the Company’s ability to conduct its operations. In such case, the Company may not be able to operate or control the VIE, which may result in deconsolidation of the VIE. The Company believes the possibility that it will no longer be able to control and consolidate its VIE will occur as a result of the aforementioned risks and uncertainties is remote. The Company has aggregated the financial information of Dongfang Paper in the table below. The aggregate carrying value of Dongfang Paper’s assets and liabilities (after elimination of intercompany transactions and balances) in the Company’s consolidated balance sheets as of December 31, 2018 and 2017 are as follows: December 31, December 31, 2018 2017 ( Unaudited) ASSETS Current Assets Cash and bank balances $ 8,328,980 $ 2,681,942 Restricted cash 3,642,616 6,121,637 Accounts receivable 2,876,632 1,843,682 Inventories 2,906,004 8,431,972 Prepayments and other current assets 6,219,395 646,598 Total current assets 23,973,627 19,725,831 Property, plant, and equipment, net 153,302,061 167,727,768 Deferred tax asset non-current 6,711,412 5,167,288 Total Assets $ 183,987,100 $ 192,620,887 LIABILITIES Current Liabilities Short-term bank loans $ 11,802,075 $ 7,192,923 Current portion of long-term loans from credit union 189,416 5,142,175 Accounts payable 629,054 422,705 Notes payable 3,642,616 6,121,637 Due to related parties 203,188 60,378 Accrued payroll and employee benefits 208,660 227,163 Other payables and accrued liabilities 10,222,766 836,309 Income taxes payable 219,305 519,365 Total current liabilities 27,117,080 20,522,655 Loans from credit union 4,706,259 - Loans from a related party 2,185,569 10,712,865 Total liabilities $ 34,008,908 $ 31,235,520 The Company and its consolidated subsidiaries are not required to provide financial support to the VIE, and no creditor (or beneficial interest holders) of the VIE have recourse to the assets of Company unless the Company separately agrees to be subject to such claims. There are no terms in any agreements or arrangements, implicit or explicit, which require the Company or its subsidiaries to provide financial support to the VIE. However, if the VIE does require financial support, the Company or its subsidiaries may, at its option and subject to statutory limits and restrictions, provide financial support to the VIE. |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | (2) Basis of Presentation and 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. Liquidity and Going Concern As of December 31, 2018 the Company had current assets of $24,158,872 and current liabilities of $29,634,267 (including amounts due to related parties of $413,336 and interest payable for related party loans of $617,454), resulting in a working capital deficit of approximately $5,475,395; as of December 31, 2017, the Company had current assets of $19,986,797 and current liabilities of $21,757,533 (including amounts due to related parties of $60,378), resulting in a working capital deficit of approximately $1,770,736. In late January, 2018, the Company temporarily suspended its production due to a government-mandated restriction on the natural gas supply. The Company resumed production on March 14, 2018. As a result, the Company incurred a net loss of $4.0 million in the first quarter of 2018. As the production resumed, the net cash generated from operations for the nine months from April 2018 to December 2018 was $14 million (cash-in) as compared to the net cash-out of $4.8 million in the first quarter of 2018. The management expects that there will be sufficient and continuous cash-in from sales in the first half of year 2019 and the working capital condition will be further improved. Foreign Currency Translation The Company accounts for foreign currency translation pursuant to ASC Topic 830, Foreign Currency Matters 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, 2018 and 2017 to translate the Chinese RMB to the U.S. Dollars are 6.8632:1, and 6.5342:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.6338:1 and 6.7423:1 for the years ended December 31, 2018 and 2017, 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, 2018 and 2017, and revenues and expenses for the years ended December 31, 2018 and 2017. 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. 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, 2018 and 2017, the balance of allowance for doubtful accounts was $58,707 and $37,626, 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 2018 2017 Opening balance $ 37,626 $ 79,478 Provision (Reversal) for the year 23,676 (45,309 ) Exchange difference (2,595 ) 3,457 Closing balance $ 58,707 $ 37,626 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 years ended December 31, 2018 and 2017. 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. Statutory Reserves According to the laws and regulations in the PRC, the Company is required to provide for certain statutory funds, namely, a 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. Each of 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, 2018 and 2017, IT Tech Packaging made transfers of $nil to this reserve fund. As a result of net loss in fiscal year 2018 and 2017 of Baoding Shengde, no statutory reserves were provided for the year ended December 31, 2018 and 2017. The Company’s variable interest entity Dongfang Paper, the statutory reserve account of which has been fully funded for 50% of its registered capital in the amount of RMB 75,030,000 (or approximately $11,811,470) since December 31, 2010, did not make any transfer to statutory reserves during the years ended December 31, 2018 and 2017. 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 for the years ended December 31, 2018 and 2017. 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 $nil of advertising and promotion costs for the years ended December 31, 2018 and 2017. 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 $30,194 and $31,922 for the years ended December 31, 2018 and 2017, 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 classification 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, 2018 and 2017, the Company received government subsidies of $241,189 and $41,529, which are recognized as subsidy income in the consolidated 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 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 the Company purchases goods from its vendors. VAT rate is 16% 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 due from government. Comprehensive Income (Loss) The Company presents comprehensive income (loss) in accordance with ASC Topic 220, Comprehensive Income 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, The Company also applies the provisions of ASC Topic 505-50, Equity Based Payments to Non-Employees 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. It 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. 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, 2018 and 2017, the carrying value of the Company’s short term financial instruments, such as cash and bank balances, accounts receivable, accounts and notes payable, short-term bank loans and balance due to related parties, approximate at their fair values because of the short maturity of these instruments; while loans from credit union, loans 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. The Company does not have any assets and liabilities measured at fair value on a recurring basis as of December 31, 2018 and 2017. Non-Recurring Fair Value Measurements The Company reviews long-lived assets for impairment annually or more frequently if events or changes in circumstances indicate the possibility of impairment. For the continuing operations, long-lived assets are measured at fair value on a nonrecurring basis when there is an indicator of impairment, and they are recorded at fair value only when impairment is recognized. For discontinued operations, long-lived assets are measured at the lower of carrying amount or fair value less cost to sell. The fair value of these assets were determined using models with significant unobservable inputs which were classified as Level 3 inputs, primarily the discounted future cash flow. |
Restricted Cash
Restricted Cash | 12 Months Ended |
Dec. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Restricted Cash | (3) Restricted Cash Restricted cash of $3,642,616 as of December 31, 2018 was presented for the cash deposited at the Bank of Cangzhou for purpose of securing the bank acceptance notes from these banks (see Note (9)). The restriction has been lifted upon the maturity of the notes payable on January 10, 2019. Restricted cash of $6,121,637 as of December 31, 2017 was presented for the cash deposited at the Bank of Cangzhou for purpose of securing the bank acceptance notes from these banks. The restriction has been lifted upon the maturity of the notes payable on January 5, 2018. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2018 | |
Inventory Disclosure [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 and December 31, 2018 and 2017: December 31, December 31, 2018 2017 Raw Materials Recycled paper board $ 412,317 $ 6,337,374 Recycled white scrap paper 611,861 862,734 Coal & gas 167,230 71,674 Base paper and other raw materials 164,295 216,655 1,355,703 7,488,437 Finished Goods 1,567,813 985,728 Totals $ 2,923,516 $ 8,474,165 |
Prepayments and Other Current A
Prepayments and Other Current Assets | 12 Months Ended |
Dec. 31, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [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, 2018 and 2017: December 31, December 31, 2018 2017 Prepaid land lease $ 437,114 $ 459,123 Value-added tax recoverable 5,760,280 - Prepayment for purchase of materials - 183,649 Others 43,905 8,751 $ 6,241,299 $ 651,523 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, plant and equipment | (6) Property, plant and equipment As of December 31, 2018 and 2017, property, plant and equipment consisted of the following: December 31, December 31, 2018 2017 Property, Plant, and Equipment: Land use rights $ 11,881,571 $ 12,479,814 Building and improvements 94,127,348 98,866,703 Machinery and equipment 147,383,943 118,670,578 Vehicles 597,484 593,265 Construction in progress 5,005,041 36,077,498 Totals 258,995,387 266,687,858 Less: accumulated depreciation and amortization (91,165,671 ) (77,299,149 ) Property, Plant and Equipment, net $ 167,829,716 $ 189,388,709 As of December 31, 2018 and December 31, 2017, land use rights represented two parcel of state-owned lands located in Xushui District of Hebei Province in China, with lease terms of 50 years expiring from 2061 to 2066. Construction in progress as of December 31, 2017 mainly represents payments for the new 15,000 tonnes per year tissue paper manufacturing equipment PM8, the tissue paper workshops and general infrastructure and administrative facilities in the Wei County Industrial Park. In December 2018, the Company announced commercial launch of PM8 and the related cost of construction in progress were capitalized as machinery and equipment costs. As of December 31, 2018 and 2017, certain property, plant and equipment of Dongfang Paper with net values of $5,782,640 and $7,963,285, respectively, have been pledged pursuant to a long-term loan from credit union of Dongfang Paper. Land use right of Dongfang Paper with net values of $5,990,586 and $6,437,419 as of December 31, 2018 and 2017 were pledged for the bank loan from Bank of Industrial & Commercial Bank of China. In addition, plant and equipment of Baoding Shengde with net values of $12,939,899 and $nil as of December 31, 2018 and 2017, respectively, and another land use right with net value of $4,762,300 and $nil as of December 31, 2018 and 2017 were pledged for the bank loan from Bank of Cangzhou. See “ Short-term bank loans Depreciation and amortization of property, plant and equipment was $14,290,919 and $14,633,780 for the years ended December 31, 2018 and 2017, respectively. Impairment loss was recorded for certain inactive production line in the amount of $3,894,461 and $2,291,027 for the years ended December 31, 2018 and 2017, respectively. |
Loans Payable
Loans Payable | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Loans Payable | (7) Loans Payable Short-term bank loans December 31, December 31, 2018 2017 Industrial and Commercial Bank of China (“ICBC”) Loan 1 (a) $ - $ 4,285,145 ICBC Loan 2 (b) - 2,907,778 Bank of Cangzhou (c) 5,099,662 - ICBC Loan 3 (d) 4,079,730 - ICBC Loan 4 (e) 2,622,683 - Total short-term bank loans $ 11,802,075 $ 7,192,923 (a) On January 10, 2017, the Company entered into a working capital loan agreement with the ICBC, with a balance of $4,285,145 as of December 31, 2017. The working capital loan was guaranteed by Hebei Tengsheng with its land use right pledged as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.5675% per annum. The loan was due and repaid on January 8, 2018. (b) On October 18, 2017, the Company entered into a working capital loan agreement with the ICBC, with a balance of $- and $2,907,778 as of December 31, 2018 and December 31, 2017. The working capital loan is secured by the Company’s land use right as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.945% per annum. The loan was due and repaid on October 12, 2018. (c) On January 2, 2018, the Company entered into a working capital loan agreement with the Bank of Cangzhou. The loan was withdrawn on January 4, 2018, with a balance of $5,099,662 as of December 31, 2018. The loan bears a fixed interest rate of 6.09% per annum. The working capital loan is secured by the Company’s land use right and guaranteed by the Company’s CEO and Baoding Shengde with its production equipment as collateral for the benefit of the bank. The loan was due and repaid on January 3, 2019. (d) On February 6, 2018, the Company entered into a working capital loan agreement with the ICBC, with a balance of $4,079,730 as of December 31, 2018. The working capital loan was guaranteed by Hebei Tengsheng with its land use right pledged as collateral for the benefit of the bank. The loan bears a fixed interest rate of 5.4% per annum. The loan was due and repaid on January 28, 2019. (e) On November 22, 2018, the Company entered into a working capital loan agreement with the ICBC, with a balance of $2,622,683 as of December 31, 2018. The working capital loan is secured by the Company’s land use right as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.741% per annum. The loan will be due on November 26, 2019. As of December 31, 2018, there were guaranteed short-term borrowings of $11,802,075 and unsecured bank loans of $nil. As of December 31, 2017, there were guaranteed short-term borrowings of $7,192,923 and unsecured bank loans of $nil. The average short-term borrowing rates for the years ended December 31, 2018 and 2017 were approximately 5.66% and 5.27%, respectively. Long-term loans from credit union As of December 31, 2018 and 2017, loans payable to Rural Credit Union of Xushui County, amounted to $7,197,808 and $7,560,221, respectively. December 31, December 31, 2018 2017 Rural Credit Union of Xushui District Loan 1 $ 1,253,060 $ 1,316,152 Rural Credit Union of Xushui District Loan 2 3,642,615 3,826,022 Rural Credit Union of Xushui District Loan 3 2,302,133 2,418,047 Total 7,197,808 7,560,221 Less: Current portion of long-term loans from credit union (2,491,549 ) (6,366,502 ) Long-term loans from credit union $ 4,706,259 $ 1,193,719 As of December 31, 2018, the Company’s long-term debt repayments for the next five years were as follows: Fiscal year Amount 2019 $ 2,491,549 2020 131,134 2021 203,986 2022 1,602,751 2023 2,768,388 Total 7,197,808 On April 16, 2014, the Company entered into a loan agreement with the Rural Credit Union of Xushui District for a term of 5 years, which is payable in various installments from June 21, 2014 to November 18, 2018. The loan is guaranteed by an independent third party. Interest payment is due quarterly and bears the rate of 0.64% per month. On November 6, 2018, the loan was renewed for additional 5 years and will be due and payable in various installments from December 21, 2018 to November 5, 2023. As of December 31, 2018 and 2017, total outstanding loan balance was $1,253,060 and $1,316,152, respectively, Out of the total outstanding loan balance, current portion amounted were $nil and $1,316,152 as of December 31, 2018 and 2017, respectively, which are presented as current liabilities in the consolidated balance sheet and the remaining balance of $1,253,060 and $nil are presented as non-current liabilities in the consolidated balance sheet as of December 31, 2018 and 2017, respectively. On July 15, 2013, the Company entered into a loan agreement with the Rural Credit Union of Xushui District for a term of 5 years, which was originally due and payable in various installments from December 21, 2013 to July 26, 2018. On June 21, 2018, the loan was extended for additional 5 years and will be due and payable in various installments from December 21, 2018 to June 20, 2023. The loan is secured by certain of the Company’s manufacturing equipment with net book value of $5,782,640 and $7,963,285 as of December 31, 2018 and 2017, respectively. Interest payment is due quarterly and bears a fixed rate of 0.64% per month. As of December 31, 2018 and 2017, the total outstanding loan balance was $3,642,615 and $3,826,022, respectively. Out of the total outstanding loan balance, current portion amounted were $nil and $3,826,022 as of December 31, 2018 and 2017, respectively, which are presented as current liabilities in the consolidated balance sheet and the remaining balance of $3,642,615 and $nil are presented as non-current liabilities in the consolidated balance sheet as of December 31, 2018 and 2017, respectively. On April 20, 2017, the Company entered into a loan agreement with the Rural Credit Union of Xushui District for a term of 2 years, which is due and payable in various installments from August 26, 2017 to April 19, 2019. The loan is guaranteed by Hebei Tengsheng with its land use right pledged as collateral for the benefit of the bank. Interest payment is due quarterly and bears a fixed rate of 0.6% per month. As of December 31, 2018 and December 31, 2017, the total outstanding loan balance was $2,302,133 and $2,418,047, respectively. Out of the total outstanding loan balance, current portion amounted were $2,302,133 and $1,224,328 as of December 31, 2018 and December 31, 2017, respectively, which are presented as current liabilities in the consolidated balance sheet and the remaining balance of $nil and $1,193,719 are presented as non-current liabilities in the consolidated balance sheet as of September 30, 2018 and December 31, 2017, respectively. Total interest expenses for the short-term bank loans and long-term loans for the years ended December 31, 2018 and 2017 were $1,214,708 and $1,196,814, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | (8) Related Party Transactions Mr Zhenyong Liu, the Company’s CEO has loaned money to Dongfang Paper for working capital purposes over a period of time. On January 1, 2013, Dongfang Paper and Mr. Zhenyong Liu renewed the three-year term loan previously entered on January 1, 2010, and extended the maturity date further to December 31, 2015. On December 31, 2015, the Company paid off the loan of $2,249,279, together with interest of $391,374 for the period from 2013 to 2015. Approximately $373,490 and $392,296 of interest were outstanding to Mr. Zhenyong Liu, which were recorded in other payables and accrued liabilities as part of the current liabilities in the consolidated balance sheet as of December 31, 2018 and 2017, respectively. On December 10, 2014, Mr. Zhenyong Liu provided a loan to the Company, amounted to $8,742,278 to Dongfang Paper for working capital purpose with an interest rate of 4.35% per annum, which was based on the primary lending rate of People’s Bank of China. The unsecured loan was provided on December 10, 2014, and would be originally due on December 10, 2017. During the year of 2016, the Company repaid $6,012,416 to Mr. Zhenyong Liu, together with interest of $288,596. In February 2018, the company repaid $3,014,863 to Mr. Zhenyong Liu, together with interest of $20,400. As of December 31, 2018 and 2017, the outstanding loan balance was $nil and $3,060,818, respectively and the accrued interest was $43,711 and $45,912, respectively, which was recorded in other payables and accrued liabilities as part of the current liabilities in the consolidated balance sheet. On March 1, 2015, the Company entered an agreement with Mr. Zhenyong Liu which allows Dongfang Paper to borrow from the CEO an amount up to $17,484,555 (RMB120,000,000) for working capital purposes. The advances or funding under the agreement are due three years from the date each amount is funded. The loan is unsecured and carries an annual interest rate set on the basis of the primary lending rate of the People’s Bank of China at the time of the borrowing. On July 13, 2015, an unsecured amount of $4,324,636 was drawn from the facility. On October 14, 2016 an unsecured amount of $2,883,091 was drawn from the facility. In February 2018, the company repaid $1,507,432 to Mr. Zhenyong Liu. The loan would be originally due on July 12, 2018. Mr. Zhenyong Liu agreed to extend the loan for additional 3 years and the remaining balance will be due on July 12, 2021. On November 23, 2018, the company repaid $3,768,579 to Mr. Zhenyong Liu, together with interest of $158,651. As of December 31, 2018 and 2017, the outstanding loan balance were $2,185,569 and $7,652,047, respectively, and the accrued interest was $200,253 and $110,476, respectively, which was recorded in other payables and accrued liabilities as part of the current liabilities in the consolidated balance sheet. As of December 31, 2018 and 2017, total amount of loans due to Mr. Zhenyong Liu were $2,185,569 and $10,712,865, respectively. The interest expense incurred for such related party loans are $277,411 and $451,626 for the years ended December 31, 2018 and 2017, respectively. The accrued interest owe to the CEO was approximately $617,454 and $548,684, as of December 31, 2018 and 2017, respectively, which was recorded in other payables and accrued liabilities. As of December 31, 2018 and 2017, amount due to shareholder are $210,148 and $nil, respectively, which represents funds from shareholders to pay for various expenses incurred in the U.S. The amount is due on demand with interest free. Sale of Headquarters Compound Real Properties to a Related Party 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 $4.31 million respectively. Sales of the LUR and the Industrial Buildings were completed in year 2013. In connection with the sale of the Industrial Buildings, Hebei Fangsheng agreed 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 $150,743 (RMB1,000,000). The lease agreement expired in August 2016. On August 6, 2016 and August 6, 2018, the Company entered into two supplementary agreements with Hebei Fangsheng, who agreed to extend the lease term for another four years in total, with the same rental payment as original lease agreement. |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2018 | |
Notes Payable [Abstract] | |
Notes payable | (9) Notes payable As of December 31, 2018, the Company had bank acceptance notes of $3,642,616 from the Bank of Cangzhou to one of its major suppliers for settling purchase of raw materials. The acceptance notes are used to essentially extend the payment of accounts payable and are issued under the banking facilities obtained from bank as well as the restricted bank deposit of $3,642,616 in the bank as mentioned in Note (3). The bank acceptance notes from the bank bore interest rate at nil% per annum and 0.05% of notes amount as handling charge. The acceptance notes were due and paid off in January 2019. As of December 31, 2017, the Company had bank acceptance notes of $6,121,637 from the Bank of Cangzhou to one of its major suppliers for settling purchase of raw materials. The acceptance notes are used to essentially extend the payment of accounts payable and are issued under the banking facilities obtained from bank as well as the restricted bank deposit of $6,121,637 in the bank. The bank acceptance notes from the bank bore interest rate at nil% per annum and 0.05% of notes amount as handling charge. The acceptance notes were due and paid off in January 2018. |
Other Payables and Accrued Liab
Other Payables and Accrued Liabilities | 12 Months Ended |
Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |
Other payables and accrued liabilities | (10) Other payables and accrued liabilities Other payables and accrued liabilities consist of the following: December 31, December 31, 2018 2017 Accrued electricity $ 186,780 $ 2,862 Value-added tax payable 520,190 196,395 Accrued interest to a related party 617,454 548,684 Payable for purchase of equipment 8,788,924 49,585 Accrued commission to salesmen 62,247 16,992 Others 47,201 21,819 Totals $ 10,222,796 $ 836,337 |
Common Stock
Common Stock | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Common Stock | (11) Common Stock Issuance of common stock to investors On August 27, 2014, the Company issued 1,562,500 shares of our common stock and warrants to purchase up to 781,250 shares of our common stock (the “Offering”). Each share of common stock and accompanying warrant was sold at a price of $1.60. Please refer to Note (12), Stock Warrants, for details. Issuance of common stock pursuant to the 2012 Incentive Stock Plan and 2015 Omnibus Equity Incentive On January 12, 2016, the Company granted an aggregate of 1,133,916 shares of common stock under its compensatory incentive plans to nine officers, directors and employees of and a consultant when the stock was at $1.25 per share, as compensation for their services in the past years, of which 168,416 shares of common stock were granted under the 2012 Incentive Stock Plan and 965,500 shares were granted under the 2015 Omnibus Equity Incentive. Please see Note (15), Stock Incentive Plans for more details. Total fair value of the stock was calculated at $1,417,395 as of the date of grant. On September 13, 2018, the compensation committee granted an aggregate of 534,500 shares of common stock at $0.88 per share to fifteen officers, directors and employees of the Company, which were granted under the 2015 Omnibus Equity Incentive Plan. Total fair value of the shares of common stock granted was calculated at $470,360 as of the date of issuance. Issuance of common stock to Weitian On October 15, 2018, the Company entered an agreement with Weitian Group LCC(“Weitian”) and agreed as compensation to issue to Weitian in the aggregate of 70,000 shares of common stock for investor relation consulting service rendered from October 15, 2018 to October 15,2019. 37500 shares of common stock were issued to Weitain on November 12, 2018. Total fair value of the shares of common stock granted was calculated at $32,625 at $0.87 per share. |
Stock Warrants
Stock Warrants | 12 Months Ended |
Dec. 31, 2018 | |
Stock Warrants [Abstract] | |
Stock warrants | (12) Stock warrants On August 27, 2014, the Company issued 1,562,500 shares of our common stock and warrants to purchase up to 781,250 shares of our common stock. The warrants have an exercise price of $1.70 per share. These warrants are exercisable immediately upon issuance on September 3, 2014 and have a term of exercise equal to five years from the date of issuance till September 2, 2019. The fair value of these shares amounted to $780,000, is classified as equity at the date of issuance. The fair value of the warrants issued was estimated by using the Binominal pricing model with the following assumptions: Terms of warrants 5 years Expected volatility 72.0 % Risk-free interest rate 1.69 % Expected dividend yield 0.81 % In connection with the Offering, the Company issued warrants to its placement agent of this Offering, which can purchase an aggregate of up to 2.50% of the aggregate number of shares of common stock sold in the Offering, i.e. 39,062 shares. These warrants have substantially the same terms as the warrants issued to purchaser in the Offering, except that the exercise price is $2.00 per share and the expiration date is from September 3, 2014 to June 26, 2019. The fair value of these shares amounted to $35,191, is classified in the equity at the date of issuance to net off the proceeds from the issuance of the shares and warrants. The fair value of the warrants issued was estimated by using the Binominal pricing model with the following assumptions: Terms of warrants 4.81 years Expected volatility 69.8 % Risk-free interest rate 1.62 % Expected dividend yield 0.81 % The Company applied judgment in estimating key assumptions in determining the fair value of the warrants on the date of issuance. The Company used historical data to estimate stock volatilities and expected dividend yield. The risk-free rates are consistent with the terms of the warrants and are based on the United States Treasury yield curve in effect at the time of issuance. A summary of stock warrant activities is as below: December 31, 2018 December 31, 2017 Number Weight average exercise price Number Weight average exercise price Outstanding and exercisable at beginning of the year 820,312 $ 1.71 820,312 $ 1.71 Issued during the year - - - - Exercised during the year - - - - Cancelled or expired during the year - - - - Outstanding and exercisable at end of the year 820,312 $ 1.71 820,312 $ 1.71 Range of exercise price $ 1.70 to $2.00 $ 1.70 to $2.00 No warrants were issued, exercised, cancelled or expired during the years ended December 31, 2018 and 2017. As of December 31, 2018 and 2017, the aggregated intrinsic value of warrants outstanding and exercisable was $nil. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | (13) Earnings Per Share For the years ended December 31, 2018 and 2017, basic and diluted net income per share are calculated as follows: Year Ended December 31, 2018 2017 Basic (loss) income per share Net (loss) income for the year - numerator $ (10,545,684 ) $ 1,659,788 Weighted average common stock outstanding - denominator 21,618,305 21,450,316 Net (loss) income per share $ (0.49 ) $ 0.08 Diluted (loss) income per share Net (loss) income for the year - numerator $ (10,545,684 ) $ 1,659,788 Weighted average common stock outstanding - denominator 21,618,305 21,450,316 Effect of dilution - - Weighted average common stock outstanding - denominator 21,618,305 21,450,316 Diluted (loss) income per share $ (0.49 ) $ 0.08 For the years ended December 31, 2018 and 2017, 820,312 shares related to warrants are excluded from the calculations of dilutive net income per share as their effects would have been anti-dilutive since the average share price for the years ended December 31, 2018 and 2017 were lower than the warrants exercise price. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | (14) Income Taxes United States The Company 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. On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the “2017 TCJAAct”), which significantly changed U.S. tax law. The Act 2017 TCJA lowered the Company’s U.S. statutory federal income tax rate from the highest rate of 35% to 21% effective January 1, 2018, while also imposing a deemed repatriation tax on deferred foreign income which requires companies to pay a one-time transition tax on previously unremitted earnings of non-U.S. subsidiaries that were previously tax deferred and creates new taxes on certain foreign sourced earnings. The SEC staff issued Staff Accounting Bulletin (SAB) 118, which provides guidance on accounting for enactment effects of the 2017 TCJA. SAB 118 provides a measurement period of up to one year from the 2017 TCJA’s enactment date for companies to complete their accounting under ASC 740. In accordance with SAB 118, to the extent that a company’s accounting for certain income tax effects of the 2017 TCJA is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in its financial statements. If a company cannot determine a provisional estimate to be included in its financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the 2017 TCJA. In connection with the Company’s initial analysis of the impact of the enactment of the 2017 TCJA, the Company recorded a net tax expense of approximately $80,000 in the fourth quarter of 2017. For various reasons that are discussed more fully below, including the issuance of additional technical and interpretive guidance, the Company has not completed its accounting for the income tax effects of certain elements of the 2017 TCJA. However, with respect to the following, the Company was able to make reasonable estimates of the 2017 TCJA’s effects and, as such, recorded provisional amounts: Transition tax: The transition tax is a tax on previously untaxed accumulated and current earnings and profits (E&P) of certain of the Company’s non-U.S. subsidiaries. To determine the amount of the transition tax, the Company must determine, in addition to other factors, the amount of post-1986 E&P of the relevant subsidiaries, as well as the amount of non-U.S. income taxes paid on such earnings. Further, the transition tax is based in part on the amount of those earnings held in cash and other specified assets. The Company was able to make a reasonable estimate of the transition tax and recorded a provisional obligation and additional income tax expense of approximately $80,000 in the fourth quarter of 2017. However, the Company is continuing to gather additional information and will consider additional technical guidance to more precisely compute and account for the amount of the transition tax. This amount may change when the Company finalizes the calculation of post-1986 foreign E&P previously deferred from U.S. federal taxation and finalizes the amounts held in cash or other specified assets. The 2017 TCJA’s transition tax is payable over eight years beginning in 2018. Hence, the Company only provided $6,528 for the year ended 31 December 2017. PRC Dongfang Paper and Baoding 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, 2018 and 2017 were as follows: Year Ended December 31, 2018 2017 Provision for Income Taxes Current Tax Provision U.S. $ 8,189 $ 6,528 Current Tax Provision PRC 230,322 3,519,311 Deferred Tax Provision PRC (2,089,439 ) (2,863,011 ) Total Provision for (Deferred tax benefit)/ Income Taxes $ (1,850,928 ) $ 662,828 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, the Company was incorporated in the United States and carried net operating losses of approximately $8,024,104 and $7,119,918 for U.S. income tax purposes as of December 31, 2018 and 2017, respectively. The net operating loss carried forward may be available to reduce future years’ taxable income. These carry forwards would expire, if not utilized, beginning in 2030. Since management believed 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, the Company has not recognized deferred tax assets for such net operating losses. A summary of the otherwise deductible (or taxable) deferred tax items is as follows: December 31, 2018 2017 Deferred tax assets Depreciation and amortization of property, plant and equipment $ 7,097,828 $ 5,123,762 Impairment of property, plant and equipment 546,531 440,080 Miscellaneous 289,799 712,517 Net operating loss carryover of PRC company 342,933 296,200 Net operating loss carryover for U.S. income tax purposes - - Total deferred tax assets 8,277,091 6,572,559 Less: Valuation allowance - - Total deferred tax assets, net $ 8,277,091 $ 6,572,559 The following table reconciles the statutory rates to the Company’s effective tax rate as of: Year ended December 31, 2018 2017 PRC Statutory rate 25.0 % 25.0 % Effect of the U.S. Transition Tax under the 2017 TCJA - 8.6 Effect of different tax jurisdiction - (0.8 ) Effect of expenses not deductible for PRC tax purposes 31.3 (6.2 ) (Over) Under-provision in previous year - (1.1 ) Change in valuation allowance - 3.0 Other (38.7 ) 3.0 Effective income tax rate 17.6 % 28.5 % As of December 31, 2017, except for the one-time transition tax under the 2017 TCJA which imposes a U.S. tax liability on all unrepatriated foreign E&Ps, the Company does not believe that its future dividend policy and the available U.S. tax deductions and net operating losses will cause the Company to recognize any other 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 Baoding Shengde and the VIE, Dongfang Paper 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. During the years ended December 31, 2018 and 2017, the effective income tax rate was estimated by the Company to be 17.6% and 28.5%, respectively. 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, 2018 and 2017, 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, 2018 and 2017, 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, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Incentive Plans | (15) Stock Incentive Plans Issuance of common stock pursuant to the 2011 Incentive Stock Plan and 2012 Incentive Stock Plan On August 28, 2011, the Company’s Annual General Meeting approved the 2011 Incentive Stock Plan ofIT Tech Packaging, Inc. (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 2, 2012, when the Compensation Committee granted 109,584 shares of restricted common stock to certain officers and directors of the Company 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. On September 10, 2012, the Company’s Annual General Meeting approved the 2012 Incentive Stock Plan of IT Tech Packaging , Inc. (the “2012 ISP”) as previously adopted by the Board of Directors on July 4, 2012. 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 restricted common shares of 297,000, out of which 265,416 shares were granted under the 2011 ISP and 31,584 shares under the 2012 ISP, to certain officers, directors and employees of the Company 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. 2015 Incentive Plan On August 29, 2015, the Company’s Annual General Meeting approved the 2015 Omnibus Equity Incentive Plan of IT Tech Packaging, Inc. (the “2015 ISP”) as previously adopted by the Board of Directors on July 10, 2015. Under the 2015 ISP, the Company may grant an aggregate of 1,500,000 shares of the Company’s common stock to the directors, officers, employees and/or consultants of the Company and its subsidiaries. On January 12, 2016, the Compensation Committee granted un-restricted common shares of 1,133,916, of which 168,416 shares were granted under the 2012 ISP and 965,500 shares under the 2015 ISP, to certain officers, directors, employees and a consultant of the Company as compensation for their services in the past years. Total fair value of the stock was calculated at $1,417,395 as of the date of issuance at $1.25 per share. On September 13, 2018, the compensation committee granted an aggregate of 534,500 shares of common stock to fifteen officers, directors and employees of the Company, which were granted under the 2015 Omnibus Equity Incentive Plan. Total fair value of the shares of common stock granted was calculated at $470,360 as of the date of issuance at $0.88 per share. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (16) Commitments and Contingencies Operating Lease The Company leases 32.95 acres of land from a local government in Xushui District, 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 $18,089 (RMB 120,000). This operating lease is renewable at the end of the 30-year term. O November 27, 2012, the company entered into a 49.4 acres land lease with an investment company in the Economic Development Zone in Wei County, Hebei Province, 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 $542,675 (RMB 3,600,000). The Company is currently building two new tissue paper production lines and future production facilities in the leased Wei County land. As mentioned in Note (8) Related Party Transactions, in connection with the sale of Industrial Buildings to Hebei Fangsheng, Hebei Fangsheng agrees to lease the Industrial Buildings back to the Company at an annual rental of $150,743 (RMB 1,000,000), for a total term of up to five years. Future minimum lease payments are as follows: December 31, Amount 2019 542,021 2020 542,021 2021 542,021 2022 542,021 2023 542,021 Thereafter 2,194,312 Total operating lease payments $ 4,904,417 Capital commitment As of December 31, 2018, the Company has signed several contracts for improvement of Industrial Buildings. Total outstanding commitments under these contracts were $2,300,187 and $11,227,896 as of December 31, 2018 and 2017, respectively. The Company expected to pay off all the balances within 1 year. Guarantees and Indemnities The Company agreed with Baoding Huanrun Trading Co., a major supplier of raw materials, to guarantee certain obligations of this third party, and as of December 31, 2018 and 2017, the Company guaranteed its long-term loan from financial institutions amounting to $4,516,843 (RMB31,000,000) and $8,159,459 (RMB56,000,000) that matured at various times in 2023. If Huanrun Trading Co., were to become insolvent, the Company could be materially adversely affected. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting | (17) Segment Reporting Since March 10, 2010, Baoding Shengde started its operations and thereafter the Company manages its operations through two business operating segments: Dongfang Paper, which produces offset printing paper and corrugating medium paper, and Baoding 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 Province, China. All sales were sold to customers located in the PRC. Summarized financial information for the two reportable segments is as follows: Year Ended December 31, 2018 Dongfang Baoding Not Attributable Elimination of Enterprise-wide, Paper Shengde to Segments Inter-segment consolidated Revenues $ 86,733,136 $ 13,622 $ - $ - $ 86,746,758 Gross profit 5,823,725 (3,324 ) - - 5,820,401 Depreciation and amortization 13,557,960 732,959 - - 14,290,919 Loss from impairment and disposal of property, plant and equipment 9,881 3,894,461 - - 3,904,342 Interest income 36,234 398 - - 36,632 Interest expense 1,318,252 173,867 - - 1,492,119 Income tax expense(benefit) (1,623,468 ) (235,649 ) 8,189 - (1,850,928 ) Net income (loss) (5,029,497 ) (4,612,001 ) (904,186 ) - (10,545,684 ) Total Assets 183,987,100 19,068,788 20,122 - 203,076,010 Year Ended December 31, 2017 Dongfang Baoding Not Attributable Elimination of Enterprise-wide, Paper Shengde to Segments Inter-segment consolidated Revenues $ 117,023,578 $ - $ - $ - $ 117,023,578 Gross profit 19,955,951 - - - 19,955,951 Depreciation and amortization 13,719,661 914,119 - - 14,633,780 Loss from impairment and disposal of property, plant and equipment 1,896,320 2,071,969 - - 3,968,289 Interest income 29,565 5,025 - - 34,590 Interest expense 2,320,147 113,623 - - 2,433,770 Income tax expense(benefit) 1,544,069 (887,769 ) 6,528 - 662,828 Net income (loss) 4,746,326 (2,293,731 ) (792,807 ) - 1,659,788 Total Assets 192,620,887 26,363,435 5,159 - 218,989,481 |
Concentration and Major Custome
Concentration and Major Customers and Suppliers | 12 Months Ended |
Dec. 31, 2018 | |
Concentration and Major Customers and Suppliers [Abstract] | |
Concentration and Major Customers and Suppliers | (18) Concentration and Major Customers and Suppliers For the years ended December 31, 2018 and 2017, the Company had no single customer contributed over 10% of total sales. For the year ended December 31, 2018, the Company had two major suppliers that accounted for 82% and 7% of total purchases by the Company. For the year ended December 31, 2017, the Company had two major suppliers that accounted for 69% and 8% of its total purchases. |
Concentration of Credit Risk
Concentration of Credit Risk | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Concentration of Credit Risk | (19) 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 cash 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 as of December 31, 2018 and December 31, 2017. On May 1, 2015, the new “Deposit Insurance Regulations” was effective in the PRC that the maximum protection would be up to RMB500,000 (US$72,852) per depositor per insured financial intuition, including both principal and interest. For the cash placed in financial institutions in the United States, the Company’s U.S. bank accounts are all fully covered by the FDIC insurance as of December 31, 2018 and 2017, respectively, while for the cash placed in financial institutions in the PRC, the balances exceeding the maximum coverage of RMB500,000 amounted to RMB80,774,719 (US$11,769,250) as of December 31, 2018. |
Risks and Uncertainties
Risks and Uncertainties | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Risks and Uncertainties | (20) Risks and Uncertainties IT Tech Packaging 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 Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | (21) Recent Accounting Pronouncements In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities” (“ASU 2016-01”). The amendments in this update require all equity investments to be measured at fair value with changes in the fair value recognized through net income (other than those accounted for under equity method of accounting or those that result in consolidation of the investee). The amendments in this update also require an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. In addition the amendments in this update eliminate the requirement to disclose the method(s) and significant assumptions used to estimate the fair value that are required to be disclosed for financial instruments measured at amortized cost on the balance sheet for public entities. For public business entities, the amendments in ASU 2016-01 are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Except for the early application guidance discussed in ASU 2016-01, early adoption of the amendments in this update is not permitted. We do not expect the adoption of ASU 2016-01 to have a material impact on our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). The amendments in this update create Topic 842, Leases, and supersede the leases requirements in Topic 840, Leases. Topic 842 specifies the accounting for leases. The objective of Topic 842 is to establish the principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. The main difference between Topic 842 and Topic 840 is the recognition of lease assets and lease liabilities for those leases classified as operating leases under Topic 840. Topic 842 retains a distinction between finance leases and operating leases. The classification criteria for distinguishing between finance leases and operating leases are substantially similar to the classification criteria for distinguishing between capital leases and operating leases in the previous leases guidance. The result of retaining a distinction between finance leases and operating leases is that under the lessee accounting model in Topic 842, the effect of leases in the statement of comprehensive income and the statement of cash flows is largely unchanged from previous GAAP. The amendments in ASU 2016-02 are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years for public business entities. Early application of the amendments in ASU 2016-02 is permitted. We are currently in the process of evaluating the impact of the adoption of ASU 2016-02 on our consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). Financial Instruments-Credit Losses (Topic 326) amends guidelines on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities. For assets held at amortized cost basis, Topic 326 eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. For available-for-sale debt securities, credit losses should be measured in a manner similar to current GAAP, however Topic 326 will require that credit losses be presented as an allowance rather than as a write-down. ASU 2016-13 affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. The amendments in this ASU will be effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. We are currently evaluating the impact of the adoption of ASU 2016-13 on our consolidated financial statements. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Event | (22) Subsequent Event None. |
Summarized Quarterly Financial
Summarized Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summarized Quarterly Financial Data (Unaudited) | (23) Summarized Quarterly Financial Data (Unaudited) Quarterly financial information for 2018 and 2017 is as follows: Quarter 2018 First Second Third Fourth Revenues $ 1,888,194 $ 33,149,190 $ 26,723,657 $ 24,985,717 Gross (loss) profit (695,308 ) 3,015,422 1,259,343 2,240,944 Loss from operations (4,519,478 ) (11,730 ) (1,570,353 ) (5,080,753 ) Net (loss) income (4,086,276 ) 109,994 (1,404,962 ) (5,164,440 ) Net income per share Basic $ -0.19 $ 0.005 $ -0.07 $ -0.24 Diluted $ -0.19 $ 0.005 $ -0.07 $ -0.24 Quarter 2017 First Second Third Fourth Revenues $ 25,289,659 $ 22,787,683 $ 33,507,053 $ 35,439,183 Gross profit 5,653,920 3,464,666 7,221,288 3,616,077 Income from operations 2,871,578 764,016 2,719,550 (1,674,877 ) Net income(loss) 1,707,869 15,917 1,572,335 (1,636,333 ) Net income per share: Basic $ 0.08 $ 0.001 $ 0.07 $ -0.076 Diluted $ 0.08 $ 0.001 $ 0.07 $ -0.076 |
Condensed Financial Information
Condensed Financial Information of the Parent Company | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Financial Information of the Parent Company | (24) Condensed Financial Information of the Parent Company The condensed financial statements of IT Tech Packaging Inc. (“ITP”, 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 $45,589,643 as of December 31, 2018 and 2017, respectively. The following represents condensed unconsolidated financial information of the parent company only: CONDENSED BALANCE SHEETS December 31, December 31, 2018 2017 ASSETS Current Assets Cash and cash equivalents $ 2,723 $ 5,158 Prepayments and other current assets 17,400 - Total current assets 20,123 5,158 Investment in subsidiaries 170,520,446 188,894,696 Total Assets $ 170,520,446 $ 188,899,854 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities Inter-company payable $ 3,990,654 $ 3,567,962 Accrued payroll and employee benefit - - Accrued liabilities - - Income tax payable - 6,528 Total current liabilities 3,990,654 3,574,490 Total liabilities $ 3,990,654 $ 3,574,490 Total stockholders’ equity 166,529,792 185,325,364 Total Liabilities and Stockholders’ Equity $ 170,520,446 $ 188,899,854 CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS) Year Ended December 31, 2018 2017 Revenue - - Selling, general and administrative expenses $ 895,995 $ 402,579 Loss from Operations (895,995 ) (402,579 ) Equity in (loss)/earnings of unconsolidated subsidiaries (9,641,498 ) 2,068,895 Other Income (Expense) - - (Loss)/Income before Income Taxes (10,537,493 ) 1,666,316 Provision for Income Taxes (8,189 ) (6,528 ) Net Income $ (10,545,682 ) $ 1,659,788 Other comprehensive income /(loss) (9,974,338 ) 10,910,190 Total Comprehensive Income (loss) $ (19,298,598 ) $ 12,569,978 CONDENSED STATEMENTS OF CASH FLOWS Year Ended December 31, 2018 2017 Net Cash (Used in) Provided by Operating Activities $ (425,127 ) $ (402,579 ) Net Cash Used in Investing Activities - - Net Cash Provided by Financing Activities 422,692 406,280 Net Increase (Decrease) in Cash and Cash Equivalents (2,435 ) 3,701 Cash and Cash Equivalents - Beginning of Year 5,158 1,457 Cash and Cash Equivalents - End of Year $ 2,723 $ 5,158 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. |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
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. |
Liquidity and Going Concern | Liquidity and Going Concern As of December 31, 2018 the Company had current assets of $24,158,872 and current liabilities of $29,634,267 (including amounts due to related parties of $413,336 and interest payable for related party loans of $617,454), resulting in a working capital deficit of approximately $5,475,395; as of December 31, 2017, the Company had current assets of $19,986,797 and current liabilities of $21,757,533 (including amounts due to related parties of $60,378), resulting in a working capital deficit of approximately $1,770,736. In late January, 2018, the Company temporarily suspended its production due to a government-mandated restriction on the natural gas supply. The Company resumed production on March 14, 2018. As a result, the Company incurred a net loss of $4.0 million in the first quarter of 2018. As the production resumed, the net cash generated from operations for the nine months from April 2018 to December 2018 was $14 million (cash-in) as compared to the net cash-out of $4.8 million in the first quarter of 2018. The management expects that there will be sufficient and continuous cash-in from sales in the first half of year 2019 and the working capital condition will be further improved. |
Foreign Currency Translation | Foreign Currency Translation The Company accounts for foreign currency translation pursuant to ASC Topic 830, Foreign Currency Matters 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, 2018 and 2017 to translate the Chinese RMB to the U.S. Dollars are 6.8632:1, and 6.5342:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.6338:1 and 6.7423:1 for the years ended December 31, 2018 and 2017, 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, 2018 and 2017, and revenues and expenses for the years ended December 31, 2018 and 2017. 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. |
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, 2018 and 2017, the balance of allowance for doubtful accounts was $58,707 and $37,626, 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 2018 2017 Opening balance $ 37,626 $ 79,478 Provision (Reversal) for the year 23,676 (45,309 ) Exchange difference (2,595 ) 3,457 Closing balance $ 58,707 $ 37,626 |
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 years ended December 31, 2018 and 2017. |
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. |
Statutory Reserves | Statutory Reserves According to the laws and regulations in the PRC, the Company is required to provide for certain statutory funds, namely, a 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. Each of 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, 2018 and 2017, IT Tech Packaging made transfers of $nil to this reserve fund. As a result of net loss in fiscal year 2018 and 2017 of Baoding Shengde, no statutory reserves were provided for the year ended December 31, 2018 and 2017. The Company’s variable interest entity Dongfang Paper, the statutory reserve account of which has been fully funded for 50% of its registered capital in the amount of RMB 75,030,000 (or approximately $11,811,470) since December 31, 2010, did not make any transfer to statutory reserves during the years ended December 31, 2018 and 2017. |
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 for the years ended December 31, 2018 and 2017. |
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 $nil of advertising and promotion costs for the years ended December 31, 2018 and 2017. |
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 $30,194 and $31,922 for the years ended December 31, 2018 and 2017, 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 classification 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, 2018 and 2017, the Company received government subsidies of $241,189 and $41,529, which are recognized as subsidy income in the consolidated 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 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 the Company purchases goods from its vendors. VAT rate is 16% 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 due from government. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) The Company presents comprehensive income (loss) in accordance with ASC Topic 220, Comprehensive Income |
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, The Company also applies the provisions of ASC Topic 505-50, Equity Based Payments to Non-Employees |
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. It 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. 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, 2018 and 2017, the carrying value of the Company’s short term financial instruments, such as cash and bank balances, accounts receivable, accounts and notes payable, short-term bank loans and balance due to related parties, approximate at their fair values because of the short maturity of these instruments; while loans from credit union, loans 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. The Company does not have any assets and liabilities measured at fair value on a recurring basis as of December 31, 2018 and 2017. |
Non-Recurring Fair Value Measurements | Non-Recurring Fair Value Measurements The Company reviews long-lived assets for impairment annually or more frequently if events or changes in circumstances indicate the possibility of impairment. For the continuing operations, long-lived assets are measured at fair value on a nonrecurring basis when there is an indicator of impairment, and they are recorded at fair value only when impairment is recognized. For discontinued operations, long-lived assets are measured at the lower of carrying amount or fair value less cost to sell. The fair value of these assets were determined using models with significant unobservable inputs which were classified as Level 3 inputs, primarily the discounted future cash flow. |
Organization and Business Bac_2
Organization and Business Background (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of subsidiaries and variable interest entities | Date of Incorporation Place of Incorporation or Percentage of Name or Establishment Establishment Ownership Principal Activity Subsidiary: Dongfang Holding November 13, 2006 BVI 100 % Inactive investment holding Shengde Holdings February 25, 2009 State of Nevada 100 % Investment holding Baoding Shengde June 1, 2009 PRC 100 % Paper production and distribution Variable interest entity (“VIE”): Dongfang Paper March 10, 1996 PRC Control * Paper production and distribution * Dongfang Paper is treated as a 100% controlled variable interest entity of the Company. |
Schedule of aggregate financial information of assets and liabilities | December 31, December 31, 2018 2017 ( Unaudited) ASSETS Current Assets Cash and bank balances $ 8,328,980 $ 2,681,942 Restricted cash 3,642,616 6,121,637 Accounts receivable 2,876,632 1,843,682 Inventories 2,906,004 8,431,972 Prepayments and other current assets 6,219,395 646,598 Total current assets 23,973,627 19,725,831 Property, plant, and equipment, net 153,302,061 167,727,768 Deferred tax asset non-current 6,711,412 5,167,288 Total Assets $ 183,987,100 $ 192,620,887 LIABILITIES Current Liabilities Short-term bank loans $ 11,802,075 $ 7,192,923 Current portion of long-term loans from credit union 189,416 5,142,175 Accounts payable 629,054 422,705 Notes payable 3,642,616 6,121,637 Due to related parties 203,188 60,378 Accrued payroll and employee benefits 208,660 227,163 Other payables and accrued liabilities 10,222,766 836,309 Income taxes payable 219,305 519,365 Total current liabilities 27,117,080 20,522,655 Loans from credit union 4,706,259 - Loans from a related party 2,185,569 10,712,865 Total liabilities $ 34,008,908 $ 31,235,520 |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of allowance of doubtful accounts | December 31, December 31, Allowance of doubtful accounts 2018 2017 Opening balance $ 37,626 $ 79,478 Provision (Reversal) for the year 23,676 (45,309 ) Exchange difference (2,595 ) 3,457 Closing balance $ 58,707 $ 37,626 |
Schedule of depreciates property, plant, and equipment estimated useful lives | 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, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | December 31, December 31, 2018 2017 Raw Materials Recycled paper board $ 412,317 $ 6,337,374 Recycled white scrap paper 611,861 862,734 Coal & gas 167,230 71,674 Base paper and other raw materials 164,295 216,655 1,355,703 7,488,437 Finished Goods 1,567,813 985,728 Totals $ 2,923,516 $ 8,474,165 |
Prepayments and Other Current_2
Prepayments and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of prepayments and other current assets | December 31, December 31, 2018 2017 Prepaid land lease $ 437,114 $ 459,123 Value-added tax recoverable 5,760,280 - Prepayment for purchase of materials - 183,649 Others 43,905 8,751 $ 6,241,299 $ 651,523 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | December 31, December 31, 2018 2017 Property, Plant, and Equipment: Land use rights $ 11,881,571 $ 12,479,814 Building and improvements 94,127,348 98,866,703 Machinery and equipment 147,383,943 118,670,578 Vehicles 597,484 593,265 Construction in progress 5,005,041 36,077,498 Totals 258,995,387 266,687,858 Less: accumulated depreciation and amortization (91,165,671 ) (77,299,149 ) Property, Plant and Equipment, net $ 167,829,716 $ 189,388,709 |
Loans Payable (Tables)
Loans Payable (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of short-term bank loans | December 31, December 31, 2018 2017 Industrial and Commercial Bank of China (“ICBC”) Loan 1 (a) $ - $ 4,285,145 ICBC Loan 2 (b) - 2,907,778 Bank of Cangzhou (c) 5,099,662 - ICBC Loan 3 (d) 4,079,730 - ICBC Loan 4 (e) 2,622,683 - Total short-term bank loans $ 11,802,075 $ 7,192,923 (a) On January 10, 2017, the Company entered into a working capital loan agreement with the ICBC, with a balance of $4,285,145 as of December 31, 2017. The working capital loan was guaranteed by Hebei Tengsheng with its land use right pledged as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.5675% per annum. The loan was due and repaid on January 8, 2018. (b) On October 18, 2017, the Company entered into a working capital loan agreement with the ICBC, with a balance of $- and $2,907,778 as of December 31, 2018 and December 31, 2017. The working capital loan is secured by the Company’s land use right as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.945% per annum. The loan was due and repaid on October 12, 2018. (c) On January 2, 2018, the Company entered into a working capital loan agreement with the Bank of Cangzhou. The loan was withdrawn on January 4, 2018, with a balance of $5,099,662 as of December 31, 2018. The loan bears a fixed interest rate of 6.09% per annum. The working capital loan is secured by the Company’s land use right and guaranteed by the Company’s CEO and Baoding Shengde with its production equipment as collateral for the benefit of the bank. The loan was due and repaid on January 3, 2019. (d) On February 6, 2018, the Company entered into a working capital loan agreement with the ICBC, with a balance of $4,079,730 as of December 31, 2018. The working capital loan was guaranteed by Hebei Tengsheng with its land use right pledged as collateral for the benefit of the bank. The loan bears a fixed interest rate of 5.4% per annum. The loan was due and repaid on January 28, 2019. (e) On November 22, 2018, the Company entered into a working capital loan agreement with the ICBC, with a balance of $2,622,683 as of December 31, 2018. The working capital loan is secured by the Company’s land use right as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.741% per annum. The loan will be due on November 26, 2019. |
Schedule of loans payable | December 31, December 31, 2018 2017 Rural Credit Union of Xushui District Loan 1 $ 1,253,060 $ 1,316,152 Rural Credit Union of Xushui District Loan 2 3,642,615 3,826,022 Rural Credit Union of Xushui District Loan 3 2,302,133 2,418,047 Total 7,197,808 7,560,221 Less: Current portion of long-term loans from credit union (2,491,549 ) (6,366,502 ) Long-term loans from credit union $ 4,706,259 $ 1,193,719 |
Schedule of long-term debt repayments | Fiscal year Amount 2019 $ 2,491,549 2020 131,134 2021 203,986 2022 1,602,751 2023 2,768,388 Total 7,197,808 |
Other Payables and Accrued Li_2
Other Payables and Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |
Schedule of other payables and accrued liabilities | December 31, December 31, 2018 2017 Accrued electricity $ 186,780 $ 2,862 Value-added tax payable 520,190 196,395 Accrued interest to a related party 617,454 548,684 Payable for purchase of equipment 8,788,924 49,585 Accrued commission to salesmen 62,247 16,992 Others 47,201 21,819 Totals $ 10,222,796 $ 836,337 |
Stock Warrants (Tables)
Stock Warrants (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Stock Warrants [Line Items] | |
Summary of stock warrant activities | December 31, 2018 December 31, 2017 Number Weight average exercise price Number Weight average exercise price Outstanding and exercisable at beginning of the year 820,312 $ 1.71 820,312 $ 1.71 Issued during the year - - - - Exercised during the year - - - - Cancelled or expired during the year - - - - Outstanding and exercisable at end of the year 820,312 $ 1.71 820,312 $ 1.71 Range of exercise price $ 1.70 to $2.00 $ 1.70 to $2.00 |
Date of issuance August 27, 2014 [Member] | |
Stock Warrants [Line Items] | |
Schedule fair value of warrants issued was estimated by using Binominal pricing model | Terms of warrants 5 years Expected volatility 72.0 % Risk-free interest rate 1.69 % Expected dividend yield 0.81 % |
Date of issuance from September 3, 2014 to June 26, 2019 [Member] | |
Stock Warrants [Line Items] | |
Schedule fair value of warrants issued was estimated by using Binominal pricing model | Terms of warrants 4.81 years Expected volatility 69.8 % Risk-free interest rate 1.62 % Expected dividend yield 0.81 % |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted net income per share | Year Ended December 31, 2018 2017 Basic (loss) income per share Net (loss) income for the year - numerator $ (10,545,684 ) $ 1,659,788 Weighted average common stock outstanding - denominator 21,618,305 21,450,316 Net (loss) income per share $ (0.49 ) $ 0.08 Diluted (loss) income per share Net (loss) income for the year - numerator $ (10,545,684 ) $ 1,659,788 Weighted average common stock outstanding - denominator 21,618,305 21,450,316 Effect of dilution - - Weighted average common stock outstanding - denominator 21,618,305 21,450,316 Diluted (loss) income per share $ (0.49 ) $ 0.08 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of provisions for income taxes | Year Ended December 31, 2018 2017 Provision for Income Taxes Current Tax Provision U.S. $ 8,189 $ 6,528 Current Tax Provision PRC 230,322 3,519,311 Deferred Tax Provision PRC (2,089,439 ) (2,863,011 ) Total Provision for (Deferred tax benefit)/ Income Taxes $ (1,850,928 ) $ 662,828 |
Schedule of deferred tax | December 31, 2018 2017 Deferred tax assets Depreciation and amortization of property, plant and equipment $ 7,097,828 $ 5,123,762 Impairment of property, plant and equipment 546,531 440,080 Miscellaneous 289,799 712,517 Net operating loss carryover of PRC company 342,933 296,200 Net operating loss carryover for U.S. income tax purposes - - Total deferred tax assets 8,277,091 6,572,559 Less: Valuation allowance - - Total deferred tax assets, net $ 8,277,091 $ 6,572,559 |
Schedule of reconciles the statutory rates effective tax rates | Year ended December 31, 2018 2017 PRC Statutory rate 25.0 % 25.0 % Effect of the U.S. Transition Tax under the 2017 TCJA - 8.6 Effect of different tax jurisdiction - (0.8 ) Effect of expenses not deductible for PRC tax purposes 31.3 (6.2 ) (Over) Under-provision in previous year - (1.1 ) Change in valuation allowance - 3.0 Other (38.7 ) 3.0 Effective income tax rate 17.6 % 28.5 % |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum lease payments of all operating leases | December 31, Amount 2019 542,021 2020 542,021 2021 542,021 2022 542,021 2023 542,021 Thereafter 2,194,312 Total operating lease payments $ 4,904,417 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of financial information for the two reportable segments | Year Ended December 31, 2018 Dongfang Baoding Not Attributable Elimination of Enterprise-wide, Paper Shengde to Segments Inter-segment consolidated Revenues $ 86,733,136 $ 13,622 $ - $ - $ 86,746,758 Gross profit 5,823,725 (3,324 ) - - 5,820,401 Depreciation and amortization 13,557,960 732,959 - - 14,290,919 Loss from impairment and disposal of property, plant and equipment 9,881 3,894,461 - - 3,904,342 Interest income 36,234 398 - - 36,632 Interest expense 1,318,252 173,867 - - 1,492,119 Income tax expense(benefit) (1,623,468 ) (235,649 ) 8,189 - (1,850,928 ) Net income (loss) (5,029,497 ) (4,612,001 ) (904,186 ) - (10,545,684 ) Total Assets 183,987,100 19,068,788 20,122 - 203,076,010 Year Ended December 31, 2017 Dongfang Baoding Not Attributable Elimination of Enterprise-wide, Paper Shengde to Segments Inter-segment consolidated Revenues $ 117,023,578 $ - $ - $ - $ 117,023,578 Gross profit 19,955,951 - - - 19,955,951 Depreciation and amortization 13,719,661 914,119 - - 14,633,780 Loss from impairment and disposal of property, plant and equipment 1,896,320 2,071,969 - - 3,968,289 Interest income 29,565 5,025 - - 34,590 Interest expense 2,320,147 113,623 - - 2,433,770 Income tax expense(benefit) 1,544,069 (887,769 ) 6,528 - 662,828 Net income (loss) 4,746,326 (2,293,731 ) (792,807 ) - 1,659,788 Total Assets 192,620,887 26,363,435 5,159 - 218,989,481 |
Summarized Quarterly Financia_2
Summarized Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly financial information | Quarter 2018 First Second Third Fourth Revenues $ 1,888,194 $ 33,149,190 $ 26,723,657 $ 24,985,717 Gross (loss) profit (695,308 ) 3,015,422 1,259,343 2,240,944 Loss from operations (4,519,478 ) (11,730 ) (1,570,353 ) (5,080,753 ) Net (loss) income (4,086,276 ) 109,994 (1,404,962 ) (5,164,440 ) Net income per share Basic $ -0.19 $ 0.005 $ -0.07 $ -0.24 Diluted $ -0.19 $ 0.005 $ -0.07 $ -0.24 Quarter 2017 First Second Third Fourth Revenues $ 25,289,659 $ 22,787,683 $ 33,507,053 $ 35,439,183 Gross profit 5,653,920 3,464,666 7,221,288 3,616,077 Income from operations 2,871,578 764,016 2,719,550 (1,674,877 ) Net income(loss) 1,707,869 15,917 1,572,335 (1,636,333 ) Net income per share: Basic $ 0.08 $ 0.001 $ 0.07 $ -0.076 Diluted $ 0.08 $ 0.001 $ 0.07 $ -0.076 |
Condensed Financial Informati_2
Condensed Financial Information of the Parent Company (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule of condensed balance sheets | December 31, December 31, 2018 2017 ASSETS Current Assets Cash and cash equivalents $ 2,723 $ 5,158 Prepayments and other current assets 17,400 - Total current assets 20,123 5,158 Investment in subsidiaries 170,520,446 188,894,696 Total Assets $ 170,520,446 $ 188,899,854 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities Inter-company payable $ 3,990,654 $ 3,567,962 Accrued payroll and employee benefit - - Accrued liabilities - - Income tax payable - 6,528 Total current liabilities 3,990,654 3,574,490 Total liabilities $ 3,990,654 $ 3,574,490 Total stockholders’ equity 166,529,792 185,325,364 Total Liabilities and Stockholders’ Equity $ 170,520,446 $ 188,899,854 |
Schedule of condensed statements of income and comprehensive income (loss) | Year Ended December 31, 2018 2017 Revenue - - Selling, general and administrative expenses $ 895,995 $ 402,579 Loss from Operations (895,995 ) (402,579 ) Equity in (loss)/earnings of unconsolidated subsidiaries (9,641,498 ) 2,068,895 Other Income (Expense) - - (Loss)/Income before Income Taxes (10,537,493 ) 1,666,316 Provision for Income Taxes (8,189 ) (6,528 ) Net Income $ (10,545,682 ) $ 1,659,788 Other comprehensive income /(loss) (9,974,338 ) 10,910,190 Total Comprehensive Income (loss) $ (19,298,598 ) $ 12,569,978 |
Schedule of condensed statements of cash flows | Year Ended December 31, 2018 2017 Net Cash (Used in) Provided by Operating Activities $ (425,127 ) $ (402,579 ) Net Cash Used in Investing Activities - - Net Cash Provided by Financing Activities 422,692 406,280 Net Increase (Decrease) in Cash and Cash Equivalents (2,435 ) 3,701 Cash and Cash Equivalents - Beginning of Year 5,158 1,457 Cash and Cash Equivalents - End of Year $ 2,723 $ 5,158 |
Organization and Business Bac_3
Organization and Business Background (Details) | 12 Months Ended | |
Dec. 31, 2018 | ||
Dongfang Holding [Member] | ||
Schedule of company's subsidiaries and variable interest entities | ||
Entity Incorporation, Date of Incorporation | Nov. 13, 2006 | |
Entity Incorporation State Country Name | BVI | |
Percentage of Ownership | 100.00% | |
Principal Activity | Inactive investment holding | |
Shengde Holdings [Member] | ||
Schedule of company's subsidiaries and variable interest entities | ||
Entity Incorporation, Date of Incorporation | Feb. 25, 2009 | |
Entity Incorporation State Country Name | State of Nevada | |
Percentage of Ownership | 100.00% | |
Principal Activity | Investment holding | |
Baoding Shengde [Member] | ||
Schedule of company's subsidiaries and variable interest entities | ||
Entity Incorporation, Date of Incorporation | Jun. 1, 2009 | |
Entity Incorporation State Country Name | PRC | |
Percentage of Ownership | 100.00% | |
Principal Activity | Paper production and distribution | |
Dongfang Paper [Member] | ||
Schedule of company's subsidiaries and variable interest entities | ||
Entity Incorporation, Date of Incorporation | Mar. 10, 1996 | |
Entity Incorporation State Country Name | PRC | |
Percentage of Ownership | Control | [1] |
Principal Activity | Paper production and distribution | |
[1] | Dongfang Paper is treated as a 100% controlled variable interest entity of the Company. |
Organization and Business Bac_4
Organization and Business Background (Details 1) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Current Assets | |||
Cash and bank balances | $ 12,117,425 | $ 9,017,427 | $ 4,494,964 |
Restricted cash | 3,642,616 | 6,121,637 | |
Accounts receivable | 2,876,632 | 1,843,682 | |
Inventories | 2,923,516 | 8,474,165 | |
Prepayments and other current assets | 6,241,299 | 651,523 | |
Total current assets | 24,158,872 | 19,986,797 | |
Property, plant, and equipment, net | 167,829,716 | 189,388,709 | |
Deferred tax asset non-current | 8,277,091 | 6,572,559 | |
Total Assets | 203,076,010 | 218,989,481 | |
Current Liabilities | |||
Short-term bank loans | 11,802,075 | 7,192,923 | |
Accounts payable | 629,054 | 422,705 | |
Notes payable | 3,642,616 | 6,121,637 | |
Due to related parties | 413,336 | 60,378 | |
Accrued payroll and employee benefits | 213,536 | 231,247 | |
Other payables and accrued liabilities | 10,222,796 | 836,337 | |
Income taxes payable | 219,305 | 525,804 | |
Total current liabilities | 29,634,267 | 21,757,533 | |
Loans from credit union | 4,706,259 | 1,193,719 | |
Loans from a related party | 2,185,569 | 10,712,865 | |
Total liabilities | 36,526,095 | 33,664,117 | |
Dongfang Paper [Member] | |||
Current Assets | |||
Cash and bank balances | 8,328,980 | 2,681,942 | |
Restricted cash | 3,642,616 | 6,121,637 | |
Accounts receivable | 2,876,632 | 1,843,682 | |
Inventories | 2,906,004 | 8,431,972 | |
Prepayments and other current assets | 6,219,395 | 646,598 | |
Total current assets | 23,973,627 | 19,725,831 | |
Property, plant, and equipment, net | 153,302,061 | 167,727,768 | |
Deferred tax asset non-current | 6,711,412 | 5,167,288 | |
Total Assets | 183,987,100 | 192,620,887 | |
Current Liabilities | |||
Short-term bank loans | 11,802,075 | 7,192,923 | |
Current portion of long-term loans from credit union | 189,416 | 5,142,175 | |
Accounts payable | 629,054 | 422,705 | |
Notes payable | 3,642,616 | 6,121,637 | |
Due to related parties | 203,188 | 60,378 | |
Accrued payroll and employee benefits | 208,660 | 227,163 | |
Other payables and accrued liabilities | 10,222,766 | 836,309 | |
Income taxes payable | 219,305 | 519,365 | |
Total current liabilities | 27,117,080 | 20,522,655 | |
Loans from credit union | 4,706,259 | ||
Loans from a related party | 2,185,569 | 10,712,865 | |
Total liabilities | $ 34,008,908 | $ 31,235,520 |
Organization and Business Bac_5
Organization and Business Background (Details Textual) | 1 Months Ended | 12 Months Ended | |||||
Feb. 10, 2010USD ($)¥ / shares | Jun. 24, 2009USD ($) | Oct. 29, 2007shares | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2010 | Jun. 30, 2010USD ($) | |
Organization and Business Background (Textual) | |||||||
Percentage of distributable profit of Dongfang Paper | 100.00% | ||||||
RMB [Member] | |||||||
Organization and Business Background (Textual) | |||||||
Exercise price for options | ¥ / shares | ¥ 1 | ||||||
Baoding Shengde [Member] | |||||||
Organization and Business Background (Textual) | |||||||
Percentage of ownership | 100.00% | ||||||
Registered capital | $ 10,000,000 | $ 60,000,000 | |||||
Loan agreement to terminate | ¥ 10,000,000 | ||||||
Dongfang Holding [Member] | |||||||
Organization and Business Background (Textual) | |||||||
Percentage of ownership | 100.00% | ||||||
Shares of common stock issued to shareholders under merger agreement | shares | 7,450,497 | ||||||
Reverse stock split | Four-for-one | ||||||
Dongfang Paper [Member] | |||||||
Organization and Business Background (Textual) | |||||||
Percentage of ownership | 100.00% | ||||||
Service fees percentage of annual net profits | 80.00% | ||||||
Percentage of distributable profit of Dongfang Paper | 100.00% | ||||||
Aggregate principal amount | $ 10,000,000 | ||||||
Loan agreement to terminate | ¥ 10,000,000 | ||||||
Percentage of revenue | 99.98% | 100.00% | |||||
Percentage of assets accounted | 90.60% | 87.96% |
Basis of Presentation and Sig_4
Basis of Presentation and Significant Accounting Policies (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Allowance for Doubtful Accounts Receivable [Roll Forward] | ||
Opening balance | $ 37,626 | $ 79,478 |
Provision (Reversal) for the year | 23,676 | (45,309) |
Exchange difference | (2,595) | 3,457 |
Closing balance | $ 58,707 | $ 37,626 |
Basis of Presentation and Sig_5
Basis of Presentation and Significant Accounting Policies (Details 1) | 12 Months Ended |
Dec. 31, 2018 | |
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 |
Vehicles [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 |
Machinery and equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, plant, and equipment, Useful life | 15 years |
Basis of Presentation and Sig_6
Basis of Presentation and Significant Accounting Policies (Details Textual) | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2018CNY (¥) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Basis of Presentation and Significant Accounting Policies (Textual) | ||||||||||||
Total current assets | $ 24,158,872 | $ 19,986,797 | $ 24,158,872 | $ 19,986,797 | ||||||||
Total current liabilities | 29,634,267 | 21,757,533 | 29,634,267 | 21,757,533 | ||||||||
Due to related parties | 413,336 | 60,378 | 413,336 | 60,378 | ||||||||
Working capital deficit | 5,475,395 | 1,770,736 | 5,475,395 | 1,770,736 | ||||||||
Interest payable for related party loans | 548,684 | 548,684 | ||||||||||
Net income (loss) | (5,164,440) | $ (1,404,962) | $ 109,994 | $ (4,086,276) | (1,636,333) | $ 1,572,335 | $ 15,917 | $ 1,707,869 | (10,545,684) | 1,659,788 | ||
Net cash in | $ 14,000,000 | |||||||||||
Net cash out | $ 4,800,000 | |||||||||||
Current exchange rates, description | The current exchange rates used by the Company as of December 31, 2018 and 2017 to translate the Chinese RMB to the U.S. Dollars are 6.8632:1, and 6.5342:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.6338:1 and 6.7423:1 for the years ended December 31, 2018 and 2017, respectively. | The current exchange rates used by the Company as of December 31, 2018 and 2017 to translate the Chinese RMB to the U.S. Dollars are 6.8632:1, and 6.5342:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.6338:1 and 6.7423:1 for the years ended December 31, 2018 and 2017, respectively. | ||||||||||
Allowance for doubtful accounts | 58,707 | 37,626 | $ 58,707 | 37,626 | $ 79,478 | |||||||
Registered capital, amount | 11,811,470 | |||||||||||
Research and development expenses | 30,194 | 31,922 | ||||||||||
Subsidy income | $ 241,189 | 41,529 | ||||||||||
Lease obligations, description | 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) 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. | ||||||||||
VAT rate | 16.00% | 16.00% | ||||||||||
Advertising and promotion costs | ||||||||||||
Transfers of reserve fund | ||||||||||||
Provision for employee benefits | ||||||||||||
RMB [Member] | ||||||||||||
Basis of Presentation and Significant Accounting Policies (Textual) | ||||||||||||
Registered capital, amount | ¥ | ¥ 75,030,000 |
Restricted Cash (Details)
Restricted Cash (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Restricted Cash (Textual) | ||
Restricted cash | $ 3,642,616 | $ 6,121,637 |
Description of restricted cash notes payable maturity | The restriction has been lifted upon the maturity of the notes payable on January 10, 2019. | The restriction has been lifted upon the maturity of the notes payable on January 5, 2018. |
Inventories (Details)
Inventories (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Schedule of inventories | ||
Raw materials | $ 1,355,703 | $ 7,488,437 |
Finished Goods | 1,567,813 | 985,728 |
Totals | 2,923,516 | 8,474,165 |
Recycled paper board [Member] | ||
Schedule of inventories | ||
Raw materials | 412,317 | 6,337,374 |
Recycled white scrap paper [Member] | ||
Schedule of inventories | ||
Raw materials | 611,861 | 862,734 |
Coal & gas [Member] | ||
Schedule of inventories | ||
Raw materials | 167,230 | 71,674 |
Base paper and other raw materials [Member] | ||
Schedule of inventories | ||
Raw materials | $ 164,295 | $ 216,655 |
Prepayments and Other Current_3
Prepayments and Other Current Assets (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Summary of prepayments and other current assets | ||
Prepaid land lease | $ 437,114 | $ 459,123 |
Value-added tax recoverable | 5,760,280 | |
Prepayment for purchase of materials | 183,649 | |
Others | 43,905 | 8,751 |
Total prepayments and other current assets | $ 6,241,299 | $ 651,523 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Schedule of property, plant and equipment | ||
Totals | $ 258,995,387 | $ 266,687,858 |
Less: accumulated depreciation and amortization | (91,165,671) | (77,299,149) |
Property, Plant and Equipment, net | 167,829,716 | 189,388,709 |
Land use rights [Member] | ||
Schedule of property, plant and equipment | ||
Totals | 11,881,571 | 12,479,814 |
Building and improvements [Member] | ||
Schedule of property, plant and equipment | ||
Totals | 94,127,348 | 98,866,703 |
Machinery and equipment [Member] | ||
Schedule of property, plant and equipment | ||
Totals | 147,383,943 | 118,670,578 |
Vehicles [Member] | ||
Schedule of property, plant and equipment | ||
Totals | 597,484 | 593,265 |
Construction in progress [Member] | ||
Schedule of property, plant and equipment | ||
Totals | $ 5,005,041 | $ 36,077,498 |
Property, Plant and Equipment_3
Property, Plant and Equipment (Details Textual) | 12 Months Ended | |
Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($)T | |
Property, plant and equipment (Textual) | ||
Production capacity of manufacturing equipment PM8 (per year) | T | 15,000 | |
Assets pledged for guarantee of Dongfang Paper capital lease | $ 5,782,640 | $ 7,963,285 |
Land use right net values pledged for sale-leaseback financing | 5,990,586 | 6,437,419 |
Value of land use right pledged for bank loan | 12,939,899 | |
Depreciation and amortization | 14,290,919 | 14,633,780 |
Impairment loss | $ 3,894,461 | 2,291,027 |
Land use rights [Member] | ||
Property, plant and equipment (Textual) | ||
Term of lease | 50 years | |
Lease expiration year | From 2061 to 2066. | |
Value of land use right pledged for bank loan | $ 4,762,300 | |
Land use rights [Member] | ||
Property, plant and equipment (Textual) | ||
Term of lease | 50 years | |
Lease expiration year | From 2061 to 2066. |
Loans Payable (Details)
Loans Payable (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of short-term bank loans | |||
Total short-term bank loans | $ 11,802,075 | $ 7,192,923 | |
Industrial and Commercial Bank of China ("ICBC") Loan 1 [Member] | |||
Schedule of short-term bank loans | |||
Total short-term bank loans | [1] | 4,285,145 | |
ICBC Loan 2 [Member] | |||
Schedule of short-term bank loans | |||
Total short-term bank loans | [2] | 2,907,778 | |
Bank of Cangzhou [Member] | |||
Schedule of short-term bank loans | |||
Total short-term bank loans | [3] | 5,099,662 | |
ICBC Loan 3 [Member] | |||
Schedule of short-term bank loans | |||
Total short-term bank loans | [4] | 4,079,730 | |
ICBC Loan 4 [Member] | |||
Schedule of short-term bank loans | |||
Total short-term bank loans | [5] | $ 2,622,683 | |
[1] | On January 10, 2017, the Company entered into a working capital loan agreement with the ICBC, with a balance of $4,285,145 as of December 31, 2017. The working capital loan was guaranteed by Hebei Tengsheng with its land use right pledged as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.5675% per annum. The loan was due and repaid on January 8, 2018. | ||
[2] | On October 18, 2017, the Company entered into a working capital loan agreement with the ICBC, with a balance of $- and $2,907,778 as of December 31, 2018 and December 31, 2017. The working capital loan is secured by the Company's land use right as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.945% per annum. The loan was due and repaid on October 12, 2018. | ||
[3] | On January 2, 2018, the Company entered into a working capital loan agreement with the Bank of Cangzhou. The loan was withdrawn on January 4, 2018, with a balance of $5,099,662 as of December 31, 2018. The loan bears a fixed interest rate of 6.09% per annum. The working capital loan is secured by the Company's land use right and guaranteed by the Company's CEO and Baoding Shengde with its production equipment as collateral for the benefit of the bank. The loan was due and repaid on January 3, 2019. | ||
[4] | On February 6, 2018, the Company entered into a working capital loan agreement with the ICBC, with a balance of $4,079,730 as of December 31, 2018. The working capital loan was guaranteed by Hebei Tengsheng with its land use right pledged as collateral for the benefit of the bank. The loan bears a fixed interest rate of 5.4% per annum. The loan was due and repaid on January 28, 2019. | ||
[5] | On November 22, 2018, the Company entered into a working capital loan agreement with the ICBC, with a balance of $2,622,683 as of December 31, 2018. The working capital loan is secured by the Company's land use right as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.741% per annum. The loan will be due on November 26, 2019. |
Loans Payable (Details 1)
Loans Payable (Details 1) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Total | $ 7,197,808 | $ 7,560,221 |
Less: Current portion of long-term loans from credit union | (2,491,549) | (6,366,502) |
Long-term loans from credit union | 4,706,259 | 1,193,719 |
Rural Credit Union of Xushui District Loan 1 [Member] | ||
Debt Instrument [Line Items] | ||
Total | 1,253,060 | 1,316,152 |
Rural Credit Union of Xushui District Loan 2 [Member] | ||
Debt Instrument [Line Items] | ||
Total | 3,642,615 | 3,826,022 |
Rural Credit Union of Xushui District Loan 3 [Member] | ||
Debt Instrument [Line Items] | ||
Total | $ 2,302,133 | $ 2,418,047 |
Loans Payable (Details 2)
Loans Payable (Details 2) | Dec. 31, 2018USD ($) |
Fiscal year | |
2,019 | $ 2,491,549 |
2,020 | 131,134 |
2,021 | 203,986 |
2,022 | 1,602,751 |
2,023 | 2,768,388 |
Total | $ 7,197,808 |
Loans Payable (Details Textual)
Loans Payable (Details Textual) - USD ($) | Jun. 21, 2018 | Feb. 06, 2018 | Jan. 02, 2018 | Jan. 10, 2017 | Jul. 15, 2013 | Nov. 06, 2018 | Oct. 18, 2017 | Apr. 20, 2017 | Apr. 16, 2014 | Dec. 31, 2018 | Dec. 31, 2017 | Nov. 22, 2018 | |
Loans Payable (Textual) | |||||||||||||
Unpaid balance of short term debt | $ 11,802,075 | $ 7,192,923 | |||||||||||
Unsecured bank loans | |||||||||||||
Long-term debt, Interest rate per month | 0.60% | 0.60% | |||||||||||
Loan extension period | 5 years | 2 years | |||||||||||
Installment repayment description | The Rural Credit Union of Xushui District for a term of 2 years, which is due and payable in various installments from August 26, 2017 to April 19, 2019. | ||||||||||||
Total outstanding loan balance | |||||||||||||
Current portion of total outstanding loan | $ 2,491,549 | 6,366,502 | |||||||||||
Interest expense for the short-term bank loans and long-term loans | $ 1,214,708 | $ 1,196,814 | |||||||||||
Average short-term borrowing rates | 5.66% | 5.27% | |||||||||||
Loans from credit union | $ 7,197,808 | $ 7,560,221 | |||||||||||
Value of land use right pledged for sale-leaseback financing | 12,939,899 | ||||||||||||
Assets pledged for guarantee of Dongfang Paper capital lease | 5,782,640 | 7,963,285 | |||||||||||
Rural credit union of xushui District member1 [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Long-term debt, Interest rate per month | 0.64% | ||||||||||||
Total outstanding loan balance | 3,826,022 | ||||||||||||
Current portion of total outstanding loan | |||||||||||||
Rural credit union of xushui District [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Loan extension period | 5 years | 5 years | |||||||||||
Installment repayment description | The loan was renewed for additional 5 years and will be due and payable in various installments from December 21, 2018 to November 5, 2023. | The Rural Credit Union of Xushui District for a term of 5 years, which is payable in various installments from June 21, 2014 to November 18, 2018. | |||||||||||
Total outstanding loan balance | 2,302,133 | 2,418,047 | |||||||||||
Current portion of total outstanding loan | 2,302,133 | 1,224,328 | |||||||||||
Non-current liabilities | 1,193,719 | ||||||||||||
ICBC Loan 1 [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Unpaid balance of short term debt | [1] | 4,285,145 | |||||||||||
Short-term bank loans, bore interest rate | 4.5675% | ||||||||||||
Loan, maturity date | Jan. 8, 2018 | ||||||||||||
ICBC Loan 2 [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Unpaid balance of short term debt | [2] | 2,907,778 | |||||||||||
Short-term bank loans, bore interest rate | 4.945% | ||||||||||||
Loan, maturity date | Oct. 12, 2018 | ||||||||||||
ICBC Loan 3 [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Unpaid balance of short term debt | [3] | 4,079,730 | |||||||||||
Short-term bank loans, bore interest rate | 5.40% | ||||||||||||
Loan, maturity date | Jan. 28, 2019 | ||||||||||||
Bank of Cangzhou [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Unpaid balance of short term debt | [4] | 5,099,662 | |||||||||||
Short-term bank loans, bore interest rate | 6.09% | ||||||||||||
Loan, maturity date | Jan. 3, 2019 | ||||||||||||
ICBC Loan 4 [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Unpaid balance of short term debt | [5] | 2,622,683 | |||||||||||
Short-term bank loans, bore interest rate | 4.741% | ||||||||||||
Rural credit union of xushui District [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Loans from credit union | $ 7,197,808 | 7,560,221 | |||||||||||
New term loan agreement [Member] | Rural credit union of xushui District [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Long-term debt, Interest rate per month | 0.64% | ||||||||||||
Loan extension period | 5 years | ||||||||||||
Installment repayment description | The Rural Credit Union of Xushui District for a term of 5 years, which was originally due and payable in various installments from December 21, 2013 to July 26, 2018. | ||||||||||||
Total outstanding loan balance | $ 3,642,615 | 3,826,022 | |||||||||||
Non-current portion of total outstanding loan | 3,642,615 | ||||||||||||
Security loan agreement by manufacturing equipment | 5,782,640 | $ 7,963,285 | |||||||||||
Long-term loan [Member] | Rural credit union of xushui District [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Long-term debt, Interest rate per month | 0.64% | ||||||||||||
Total outstanding loan balance | 1,253,060 | $ 1,316,152 | |||||||||||
Current portion of total outstanding loan | 1,316,152 | ||||||||||||
Rural credit union of xushui District member1 [Member] | |||||||||||||
Loans Payable (Textual) | |||||||||||||
Loans from credit union | $ 3,642,615 | $ 3,826,022 | |||||||||||
[1] | On January 10, 2017, the Company entered into a working capital loan agreement with the ICBC, with a balance of $4,285,145 as of December 31, 2017. The working capital loan was guaranteed by Hebei Tengsheng with its land use right pledged as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.5675% per annum. The loan was due and repaid on January 8, 2018. | ||||||||||||
[2] | On October 18, 2017, the Company entered into a working capital loan agreement with the ICBC, with a balance of $- and $2,907,778 as of December 31, 2018 and December 31, 2017. The working capital loan is secured by the Company's land use right as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.945% per annum. The loan was due and repaid on October 12, 2018. | ||||||||||||
[3] | On February 6, 2018, the Company entered into a working capital loan agreement with the ICBC, with a balance of $4,079,730 as of December 31, 2018. The working capital loan was guaranteed by Hebei Tengsheng with its land use right pledged as collateral for the benefit of the bank. The loan bears a fixed interest rate of 5.4% per annum. The loan was due and repaid on January 28, 2019. | ||||||||||||
[4] | On January 2, 2018, the Company entered into a working capital loan agreement with the Bank of Cangzhou. The loan was withdrawn on January 4, 2018, with a balance of $5,099,662 as of December 31, 2018. The loan bears a fixed interest rate of 6.09% per annum. The working capital loan is secured by the Company's land use right and guaranteed by the Company's CEO and Baoding Shengde with its production equipment as collateral for the benefit of the bank. The loan was due and repaid on January 3, 2019. | ||||||||||||
[5] | On November 22, 2018, the Company entered into a working capital loan agreement with the ICBC, with a balance of $2,622,683 as of December 31, 2018. The working capital loan is secured by the Company's land use right as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.741% per annum. The loan will be due on November 26, 2019. |
Related Party Transactions (Det
Related Party Transactions (Details) | Oct. 14, 2016USD ($) | Aug. 06, 2016 | Mar. 01, 2015USD ($) | Dec. 10, 2014USD ($) | Aug. 07, 2013USD ($)Employee | Aug. 07, 2013CNY (¥)Employee | Nov. 23, 2018USD ($) | Feb. 28, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Jul. 13, 2015USD ($) | Mar. 01, 2015CNY (¥) | Jan. 01, 2013 |
Related Party Transactions (Textual) | ||||||||||||||||
Accrued interest | $ 548,684 | $ 548,684 | ||||||||||||||
Proceeds from shareholders loan | $ 4,522,295 | |||||||||||||||
Accrued rental owned to Hebei Fangsheng | 413,336 | 60,378 | 60,378 | |||||||||||||
Repayment of related party loans | 12,813,169 | |||||||||||||||
Due to shareholder | 210,148 | |||||||||||||||
CEO [Member] | ||||||||||||||||
Related Party Transactions (Textual) | ||||||||||||||||
Loans payable to related party | $ 2,883,091 | $ 17,484,555 | $ 4,324,636 | |||||||||||||
Term of loan | 3 years | |||||||||||||||
Outstanding loan balance | 2,185,569 | 7,652,047 | 7,652,047 | |||||||||||||
Loan matures date | Jul. 12, 2018 | |||||||||||||||
Accrued interest | 200,253 | 110,476 | 110,476 | |||||||||||||
CEO [Member] | RMB [Member] | ||||||||||||||||
Related Party Transactions (Textual) | ||||||||||||||||
Loans payable to related party | ¥ | ¥ 120,000,000 | |||||||||||||||
Mr Zhenyong Liu [Member] | ||||||||||||||||
Related Party Transactions (Textual) | ||||||||||||||||
Loan paid off | $ 20,400 | $ 2,249,279 | ||||||||||||||
Loans payable to related party | 2,185,569 | 10,712,865 | 10,712,865 | |||||||||||||
Term of loan | 3 years | |||||||||||||||
Interest rate on loans | 4.35% | |||||||||||||||
Outstanding loan balance | 3,060,818 | 3,060,818 | ||||||||||||||
Loan matures date | Jul. 12, 2021 | |||||||||||||||
Accrued interest | 43,711 | 45,912 | 45,912 | |||||||||||||
Loan from related parties, interest expense | 277,411 | 451,626 | ||||||||||||||
Interest paid | $ 288,596 | $ 391,374 | ||||||||||||||
Repayment of related party loans | 3,014,863 | $ 6,012,416 | ||||||||||||||
Lease term renewed | 3 years | |||||||||||||||
Hebei Fangsheng [Member] | ||||||||||||||||
Related Party Transactions (Textual) | ||||||||||||||||
Rental payment | $ 150,743 | |||||||||||||||
Industrial building lease term | 3 years | 3 years | ||||||||||||||
Number of dormitory buildings | Employee | 3 | 3 | ||||||||||||||
Sale price of industrial land use rights | $ 2,770,000 | |||||||||||||||
Sale price of industrial building | $ 1,150,000 | |||||||||||||||
Lease expiration date | Aug. 31, 2016 | Aug. 31, 2016 | ||||||||||||||
Sale price of dormitory buildings | $ 4,310,000 | |||||||||||||||
Lease term extend | 4 years | |||||||||||||||
Hebei Fangsheng [Member] | RMB [Member] | ||||||||||||||||
Related Party Transactions (Textual) | ||||||||||||||||
Rental payment | ¥ | ¥ 1,000,000 | |||||||||||||||
Dongfang Paper [Member] | ||||||||||||||||
Related Party Transactions (Textual) | ||||||||||||||||
Lease term renewed | 3 years | |||||||||||||||
Dongfang Paper [Member] | Mr Zhenyong Liu [Member] | ||||||||||||||||
Related Party Transactions (Textual) | ||||||||||||||||
Loan paid off | $ 158,651 | |||||||||||||||
Loans payable to related party | $ 8,742,278 | |||||||||||||||
Loan matures date | Dec. 10, 2017 | |||||||||||||||
Accrued interest | 200,253 | |||||||||||||||
Other payables and accrued liabilities | $ 373,490 | $ 392,296 | $ 392,296 | |||||||||||||
Repayment of related party loans | $ 3,768,579 | $ 1,507,432 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Notes Payable (Textual) | ||
Notes payable | $ 3,642,616 | $ 6,121,637 |
Restricted cash | $ 3,642,616 | $ 6,121,637 |
Bank of Cangzhou [Member] | ||
Notes Payable (Textual) | ||
Bank acceptance notes from bank, interest rate | 0.00% | 0.00% |
Handling charges of bank acceptance notes percentage | 0.05% | 0.05% |
Description of maturity of notes payable | The acceptance notes were due and paid off in January 2019. | The acceptance notes were due and paid off in January 2018. |
Other Payables and Accrued Li_3
Other Payables and Accrued Liabilities (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Summary of other payables and accrued liabilities | ||
Accrued electricity | $ 186,780 | $ 2,862 |
Value-added tax payable | 520,190 | 196,395 |
Accrued interest to a related party | 617,454 | 548,684 |
Payable for purchase of equipment | 8,788,924 | 49,585 |
Accrued commission to salesmen | 62,247 | 16,992 |
Others | 47,201 | 21,819 |
Totals | $ 10,222,796 | $ 836,337 |
Common Stock (Details)
Common Stock (Details) | Jan. 12, 2016USD ($)Employee$ / sharesshares | Aug. 27, 2014$ / sharesshares | Nov. 12, 2018USD ($)$ / sharesshares | Oct. 15, 2018shares | Sep. 13, 2018USD ($)$ / sharesshares | Dec. 31, 2013USD ($) |
Investors [Member] | ||||||
Common Stock (Textual) | ||||||
Issuance of common stock and warrants | 1,562,500 | |||||
Warrants to purchase of common stock | 781,250 | |||||
Share price | $ / shares | $ 1.60 | |||||
Weitian Group LCC [Member] | ||||||
Common Stock (Textual) | ||||||
Issuance of common stock and warrants | 37,500 | |||||
Share price | $ / shares | $ 0.87 | |||||
Shares of common stock under compensatory incentive plans | 70,000 | |||||
Total fair value of stock of grant | $ | $ 32,625 | |||||
2012 Incentive Stock Plan [Member] | ||||||
Common Stock (Textual) | ||||||
Shares of common stock under compensatory incentive plans | 168,416 | |||||
Total fair value of stock of grant | $ | $ 790,020 | |||||
2015 Omnibus Equity Incentive [Member] | ||||||
Common Stock (Textual) | ||||||
Share price | $ / shares | $ 0.88 | |||||
Shares of common stock under compensatory incentive plans | 965,500 | |||||
Total fair value of stock of grant | $ | $ 1,417,395 | $ 470,360 | ||||
Compensatory Incentive Plans [Member] | ||||||
Common Stock (Textual) | ||||||
Share price | $ / shares | $ 1.25 | $ 0.88 | ||||
Shares of common stock under compensatory incentive plans | 1,133,916 | 534,500 | ||||
Number of officers | Employee | 9 | |||||
Total fair value of stock of grant | $ | $ 470,360 |
Stock Warrants (Details)
Stock Warrants (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Date of Issuance August 27, 2014 to September 2, 2019 [Member] | |
Stock Warrants [Line Items] | |
Terms of warrants | 5 years |
Expected volatility | 72.00% |
Risk-free interest rate | 1.69% |
Expected dividend yield | 0.81% |
Date of Issuance September 3, 2014 to June 26, 2019 [Member] | |
Stock Warrants [Line Items] | |
Terms of warrants | 4 years 9 months 22 days |
Expected volatility | 69.80% |
Risk-free interest rate | 1.62% |
Expected dividend yield | 0.81% |
Stock Warrants (Details 1)
Stock Warrants (Details 1) - Warrant [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Number | ||
Outstanding and exercisable at beginning of the year | 820,312 | 820,312 |
Issued during the year | ||
Exercised during the year | ||
Cancelled or expired during the year | ||
Outstanding and exercisable at end of the year | 820,312 | 820,312 |
Weight average exercise price | ||
Outstanding and exercisable at beginning of the year | $ 1.71 | $ 1.71 |
Issued during the year | ||
Exercised during the year | ||
Cancelled or expired during the year | ||
Outstanding and exercisable at end of the year | 1.71 | 1.71 |
Range of exercise price, lower range limit | 1.70 | 1.70 |
Range of exercise price, upper range limit | $ 2 | $ 2 |
Stock Warrants (Details Textual
Stock Warrants (Details Textual) - Warrant [Member] - USD ($) | Aug. 27, 2014 | Dec. 31, 2018 | Dec. 31, 2017 |
Stock Warrants (Textual) | |||
Issuance of common stock and warrants | 1,562,500 | ||
Warrants to purchase shares of common stock | 781,250 | ||
Exercise price | $ 1.70 | $ 2 | |
Warrants exercisable term | 5 years | ||
Fair value of common stock sold | $ 780,000 | $ 35,191 | |
Aggregate percentage of common stock sold under offering | 2.50% | ||
Aggregate number of shares of common stock sold | 39,062 | ||
Warrants expiration date | Sep. 2, 2019 | Jun. 26, 2019 | |
Aggregated intrinsic value of warrants outstanding and exercisable |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Basic (loss) income per share | ||||||||||
Net (loss) income for the year - numerator | $ (5,164,440) | $ (1,404,962) | $ 109,994 | $ (4,086,276) | $ (1,636,333) | $ 1,572,335 | $ 15,917 | $ 1,707,869 | $ (10,545,684) | $ 1,659,788 |
Weighted average common stock outstanding - denominator | 21,618,305 | 21,450,316 | ||||||||
Net (loss) income per share | $ (0.24) | $ (0.07) | $ 0.005 | $ (0.19) | $ (0.076) | $ 0.07 | $ 0.001 | $ 0.08 | $ (0.49) | $ 0.08 |
Diluted (loss) income per share | ||||||||||
Net (loss) income for the year - numerator | $ (5,164,440) | $ (1,404,962) | $ 109,994 | $ (4,086,276) | $ (1,636,333) | $ 1,572,335 | $ 15,917 | $ 1,707,869 | $ (10,545,684) | $ 1,659,788 |
Weighted average common stock outstanding - denominator | 21,618,305 | 21,450,316 | ||||||||
Effect of dilution | ||||||||||
Weighted average common stock outstanding - denominator | 21,618,305 | 21,450,316 | ||||||||
Diluted (loss) income per share | $ (0.24) | $ (0.07) | $ 0.005 | $ (0.19) | $ (0.076) | $ 0.07 | $ 0.001 | $ 0.08 | $ (0.49) | $ 0.08 |
Earnings Per Share (Details Tex
Earnings Per Share (Details Textual) - shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Earnings Per Share (Textual) | ||
Warrants shares are excluded from calculations of dilutive net income per share | 820,312 | 820,312 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Provision for Income Taxes | ||
Current Tax Provision U.S. | $ 8,189 | $ 6,528 |
Current Tax Provision PRC | 230,322 | 3,519,311 |
Deferred Tax Provision PRC | (2,089,439) | (3,010,577) |
Total Provision for (Deferred tax benefit)/ Income Taxes | $ (1,850,928) | $ 662,828 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets | ||
Depreciation and amortization of property, plant and equipment | $ 7,097,828 | $ 5,123,762 |
Impairment of property, plant and equipment | 546,531 | 440,080 |
Miscellaneous | 289,799 | 712,517 |
Net operating loss carryover of PRC company | 342,933 | 296,200 |
Net operating loss carryover for U.S. income tax purposes | ||
Total deferred tax assets | 8,277,091 | 6,572,559 |
Less: Valuation allowance | ||
Total deferred tax assets, net | $ 8,277,091 | $ 6,572,559 |
Income Taxes (Details 2)
Income Taxes (Details 2) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of reconciliation of statutory rates to Company's effective tax rate | ||
PRC Statutory rate | 25.00% | 25.00% |
Effect of the U.S. Transition Tax under the 2017 TCJA | 8.60% | |
Effect of different tax jurisdiction | (0.80%) | |
Effect of expenses not deductible for PRC tax purposes | 31.30% | (6.20%) |
(Over) Underprovision in previous year | (1.10%) | |
Change in valuation allowance | 3.00% | |
Other | 38.70% | 3.00% |
Effective income tax rate | 17.60% | 28.50% |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2017 | |
Income Taxes (Textual) | ||||
Statutory tax rate | 25.00% | 25.00% | ||
Effective income tax rate | 17.60% | 28.50% | ||
Income tax, statute of limitations period | 5 years | |||
Income tax expense | $ (1,850,928) | $ 662,828 | ||
Federal taxation cash provided | $ 6,528 | |||
Description of carry forwards expire | These carry forwards would expire, if not utilized, beginning in 2030. | |||
United States [Member] | ||||
Income Taxes (Textual) | ||||
Statutory tax rate | 34.00% | |||
State tax rates | 0.00% | |||
Income tax expense | $ 80,000 | |||
Additional income tax expense | 80,000 | |||
PRC [Member] | ||||
Income Taxes (Textual) | ||||
Statutory tax rate | 25.00% | |||
Net operating losses | $ 7,119,918 | $ 8,024,104 | $ 7,119,918 | $ 7,119,918 |
Minimum [Member] | ||||
Income Taxes (Textual) | ||||
Effective income tax rate | 21.00% | |||
Maximum [Member] | ||||
Income Taxes (Textual) | ||||
Effective income tax rate | 35.00% |
Stock Incentive Plans (Details)
Stock Incentive Plans (Details) - USD ($) | Jan. 12, 2016 | Sep. 13, 2018 | Dec. 31, 2013 | Aug. 28, 2011 | Aug. 29, 2015 | Sep. 10, 2012 |
2015 ISP [Member] | ||||||
Stock Incentive Plans (Textual) | ||||||
Number of shares authorized for issuance under stock incentive plan | 534,500 | 1,500,000 | ||||
Shares issued under incentive stock plan | 965,500 | |||||
Un-restricted common shares | 1,133,916 | |||||
Share price | $ 0.88 | |||||
Total fair value of stock of grant | $ 1,417,395 | $ 470,360 | ||||
2012 ISP [Member] | ||||||
Stock Incentive Plans (Textual) | ||||||
Number of shares authorized for issuance under stock incentive plan | 200,000 | |||||
Shares issued under incentive stock plan | 168,416 | 31,584 | ||||
Total fair value of stock of grant | $ 790,020 | |||||
Restricted common shares granted | 297,000 | |||||
2011 ISP [Member] | ||||||
Stock Incentive Plans (Textual) | ||||||
Number of shares authorized for issuance under stock incentive plan | 375,000 | |||||
Shares issued under incentive stock plan | 265,416 | 109,584 | ||||
Share price | $ 2.66 | $ 3.45 | ||||
Total fair value of stock of grant | $ 378,065 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) | Dec. 31, 2018USD ($) |
Schedule of future minimum lease payments of all operating leases | |
2,019 | $ 542,021 |
2,020 | 542,021 |
2,021 | 542,021 |
2,022 | 542,021 |
2,023 | 542,021 |
Thereafter | 2,194,312 |
Total operating lease payments | $ 4,904,417 |
Commitments and Contingencies_3
Commitments and Contingencies (Details Textual) | 1 Months Ended | 12 Months Ended | |||||
Nov. 27, 2012USD ($)a | Nov. 27, 2012CNY (¥)a | Dec. 31, 2018USD ($)a | Dec. 31, 2018CNY (¥) | Dec. 31, 2018CNY (¥)a | Dec. 31, 2017USD ($) | Dec. 31, 2017CNY (¥) | |
Commitments and Contingencies (Textual) | |||||||
Outstanding commitments for construction of equipment and facilities | $ 2,300,187 | $ 11,227,896 | |||||
Performance holdback on new tissue paper payment, description | The Company expected to pay off all the balances within 1 year. | The Company expected to pay off all the balances within 1 year. | |||||
Long-term loan from financial institutions | $ 4,516,843 | $ 8,159,459 | |||||
Long-term loan maturity, description | The Company guaranteed its long-term loan from financial institutions amounting to $4,516,843 (RMB31,000,000) and $8,159,459 (RMB56,000,000) that matured at various times in 2023. | The Company guaranteed its long-term loan from financial institutions amounting to $4,516,843 (RMB31,000,000) and $8,159,459 (RMB56,000,000) that matured at various times in 2023. | |||||
RMB [Member] | |||||||
Commitments and Contingencies (Textual) | |||||||
Long-term loan from financial institutions | ¥ | ¥ 31,000,000 | ¥ 56,000,000 | |||||
Investment company [Member] | |||||||
Commitments and Contingencies (Textual) | |||||||
Area of land | a | 49.4 | 49.4 | |||||
Lease expiration period | 15 years | 15 years | |||||
Operating lease annual rental payment | $ 542,675 | ||||||
Investment company [Member] | RMB [Member] | |||||||
Commitments and Contingencies (Textual) | |||||||
Operating lease annual rental payment | ¥ | ¥ 3,600,000 | ||||||
Local government [Member] | |||||||
Commitments and Contingencies (Textual) | |||||||
Area of land | a | 32.95 | 32.95 | |||||
Lease expiration period | 30 years | 30 years | |||||
Lease expiration date | Dec. 31, 2031 | Dec. 31, 2031 | |||||
Operating lease annual rental payment | $ 18,089 | ||||||
Local government [Member] | RMB [Member] | |||||||
Commitments and Contingencies (Textual) | |||||||
Operating lease annual rental payment | ¥ | ¥ 120,000 | ||||||
Hebei Fangsheng [Member] | |||||||
Commitments and Contingencies (Textual) | |||||||
Lease expiration period | 5 years | 5 years | |||||
Operating lease annual rental payment | $ 150,743 | ||||||
Hebei Fangsheng [Member] | RMB [Member] | |||||||
Commitments and Contingencies (Textual) | |||||||
Operating lease annual rental payment | ¥ | ¥ 1,000,000 |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Summarized financial information for reportable segments | ||||||||||
Revenues | $ 24,985,717 | $ 26,723,657 | $ 33,149,190 | $ 1,888,194 | $ 35,439,183 | $ 33,507,053 | $ 22,787,683 | $ 25,289,659 | $ 86,746,758 | $ 117,023,578 |
Gross profit (loss) | 2,240,944 | 1,259,343 | 3,015,422 | (695,308) | 3,616,077 | 7,221,288 | 3,464,666 | 5,653,920 | 5,820,401 | 19,955,951 |
Depreciation and amortization | 14,290,919 | 14,633,780 | ||||||||
Loss from impairment and disposal of property, plant and equipment | (9,881) | (1,677,262) | ||||||||
Interest income | 36,632 | 34,590 | ||||||||
Interest expense | 1,492,119 | 2,433,770 | ||||||||
Income tax expense(benefit) | (1,850,928) | 662,828 | ||||||||
Net income (loss) | (5,164,440) | $ (1,404,962) | $ 109,994 | $ (4,086,276) | (1,636,333) | $ 1,572,335 | $ 15,917 | $ 1,707,869 | (10,545,684) | 1,659,788 |
Total assets | 203,076,010 | 218,989,481 | 203,076,010 | 218,989,481 | ||||||
Dongfang Paper [Member] | ||||||||||
Summarized financial information for reportable segments | ||||||||||
Revenues | 86,733,136 | 117,023,578 | ||||||||
Gross profit (loss) | 5,823,725 | 19,955,951 | ||||||||
Depreciation and amortization | 13,557,960 | 13,719,661 | ||||||||
Loss from impairment and disposal of property, plant and equipment | 9,881 | 1,896,320 | ||||||||
Interest income | 36,234 | 29,565 | ||||||||
Interest expense | 1,318,252 | 2,320,147 | ||||||||
Income tax expense(benefit) | (1,623,468) | 1,544,069 | ||||||||
Net income (loss) | (5,029,497) | 4,746,326 | ||||||||
Total assets | 183,987,100 | 192,620,887 | 183,987,100 | 192,620,887 | ||||||
Baoding Shengde [Member] | ||||||||||
Summarized financial information for reportable segments | ||||||||||
Revenues | 13,622 | |||||||||
Gross profit (loss) | (3,324) | |||||||||
Depreciation and amortization | 732,959 | 914,119 | ||||||||
Loss from impairment and disposal of property, plant and equipment | 3,894,461 | 2,071,969 | ||||||||
Interest income | 398 | 5,025 | ||||||||
Interest expense | 173,867 | 113,623 | ||||||||
Income tax expense(benefit) | (235,649) | (887,769) | ||||||||
Net income (loss) | (4,612,001) | (2,293,731) | ||||||||
Total assets | 19,068,788 | 26,363,435 | 19,068,788 | 26,363,435 | ||||||
Not Attributable to Segments [Member] | ||||||||||
Summarized financial information for reportable segments | ||||||||||
Revenues | ||||||||||
Gross profit (loss) | ||||||||||
Depreciation and amortization | ||||||||||
Loss from impairment and disposal of property, plant and equipment | ||||||||||
Interest income | ||||||||||
Interest expense | ||||||||||
Income tax expense(benefit) | 8,189 | 6,528 | ||||||||
Net income (loss) | (904,186) | (792,807) | ||||||||
Total assets | 20,122 | 5,159 | 20,122 | 5,159 | ||||||
Elimination of Inter-segment [Member] | ||||||||||
Summarized financial information for reportable segments | ||||||||||
Revenues | ||||||||||
Gross profit (loss) | ||||||||||
Depreciation and amortization | ||||||||||
Loss from impairment and disposal of property, plant and equipment | ||||||||||
Interest income | ||||||||||
Interest expense | ||||||||||
Income tax expense(benefit) | ||||||||||
Net income (loss) | ||||||||||
Total assets | ||||||||||
Enterprise-wide, consolidated [Member] | ||||||||||
Summarized financial information for reportable segments | ||||||||||
Revenues | 86,746,758 | 117,023,578 | ||||||||
Gross profit (loss) | 5,820,401 | 19,955,951 | ||||||||
Depreciation and amortization | 14,290,919 | 14,633,780 | ||||||||
Loss from impairment and disposal of property, plant and equipment | 3,904,342 | 3,968,289 | ||||||||
Interest income | 36,632 | 34,590 | ||||||||
Interest expense | 1,492,119 | 2,433,770 | ||||||||
Income tax expense(benefit) | (1,850,928) | 662,828 | ||||||||
Net income (loss) | (10,545,684) | 1,659,788 | ||||||||
Total assets | $ 203,076,010 | $ 218,989,481 | $ 203,076,010 | $ 218,989,481 |
Segment Reporting (Details Text
Segment Reporting (Details Textual) | 12 Months Ended |
Dec. 31, 2018Segments | |
Segment Reporting (Textual) | |
Number of business operating segments | 2 |
Number of reportable segment | 2 |
Concentration and Major Custo_2
Concentration and Major Customers and Suppliers (Details) | 12 Months Ended | |
Dec. 31, 2018SupplierCustomer | Dec. 31, 2017SupplierCustomer | |
Concentration and Major Customers and Suppliers (Textual) | ||
Number of major supplier | Supplier | 2 | 2 |
Number of customer | Customer | ||
Supplier One [Member] | ||
Concentration and Major Customers and Suppliers (Textual) | ||
Percentage of revenue | 82.00% | 69.00% |
Supplier Two [Member] | ||
Concentration and Major Customers and Suppliers (Textual) | ||
Percentage of revenue | 7.00% | 8.00% |
Sales [Member] | ||
Concentration and Major Customers and Suppliers (Textual) | ||
Percentage of revenue | 10.00% | 10.00% |
Concentration of Credit Risk (D
Concentration of Credit Risk (Details) | May 01, 2015USD ($) | May 01, 2015CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2018CNY (¥) |
Concentration of Credit Risk (Textual) | ||||
Federal deposit insurance corporation | $ 72,852 | $ 11,769,250 | ||
RMB [Member] | ||||
Concentration of Credit Risk (Textual) | ||||
Federal deposit insurance corporation | ¥ | ¥ 500,000 | ¥ 80,774,719 | ||
Maximum coverage from FDIC | $ 500,000 |
Summarized Quarterly Financia_3
Summarized Quarterly Financial Data (Unaudited) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Summarized Quarterly Financial Data (Unaudited) [Abstract] | ||||||||||
Revenues | $ 24,985,717 | $ 26,723,657 | $ 33,149,190 | $ 1,888,194 | $ 35,439,183 | $ 33,507,053 | $ 22,787,683 | $ 25,289,659 | $ 86,746,758 | $ 117,023,578 |
Gross (loss) profit | 2,240,944 | 1,259,343 | 3,015,422 | (695,308) | 3,616,077 | 7,221,288 | 3,464,666 | 5,653,920 | 5,820,401 | 19,955,951 |
Loss from operations | (5,080,753) | (1,570,353) | (11,730) | (4,519,478) | (1,674,877) | 2,719,550 | 764,016 | 2,871,578 | (11,182,314) | 4,680,267 |
Net (loss) income | $ (5,164,440) | $ (1,404,962) | $ 109,994 | $ (4,086,276) | $ (1,636,333) | $ 1,572,335 | $ 15,917 | $ 1,707,869 | $ (10,545,684) | $ 1,659,788 |
Net income per share | ||||||||||
Basic | $ (0.24) | $ (0.07) | $ 0.005 | $ (0.19) | $ (0.076) | $ 0.07 | $ 0.001 | $ 0.08 | $ (0.49) | $ 0.08 |
Diluted | $ (0.24) | $ (0.07) | $ 0.005 | $ (0.19) | $ (0.076) | $ 0.07 | $ 0.001 | $ 0.08 | $ (0.49) | $ 0.08 |
Condensed Financial Informati_3
Condensed Financial Information of the Parent Company (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Current Assets | |||
Cash and cash equivalents | $ 12,117,425 | $ 9,017,427 | $ 4,494,964 |
Prepayments and other current assets | 6,241,299 | 651,523 | |
Total current assets | 24,158,872 | 19,986,797 | |
Total Assets | 203,076,010 | 218,989,481 | |
Current Liabilities | |||
Accrued payroll and employee benefits | 213,536 | 231,247 | |
Accrued liabilities | 617,454 | 548,684 | |
Income tax payable | 219,305 | 525,804 | |
Total current liabilities | 29,634,267 | 21,757,533 | |
Total liabilities | 36,526,095 | 33,664,117 | |
Total stockholders' equity | 166,549,915 | 185,325,364 | 172,755,386 |
Total Liabilities and Stockholders' Equity | 203,076,010 | 218,989,481 | |
Parent Company [Member] | |||
Current Assets | |||
Cash and cash equivalents | 2,723 | 5,158 | $ 1,457 |
Prepayments and other current assets | 17,400 | ||
Total current assets | 20,123 | 5,158 | |
Investment in subsidiaries | 170,520,446 | 188,894,696 | |
Total Assets | 170,520,446 | 188,899,854 | |
Current Liabilities | |||
Inter-company payable | 3,990,654 | 3,567,962 | |
Accrued payroll and employee benefits | |||
Accrued liabilities | |||
Income tax payable | 6,528 | ||
Total current liabilities | 3,990,654 | 3,574,490 | |
Total liabilities | 3,990,654 | 3,574,490 | |
Total stockholders' equity | 166,529,792 | 185,325,364 | |
Total Liabilities and Stockholders' Equity | $ 170,520,446 | $ 188,899,854 |
Condensed Financial Informati_4
Condensed Financial Information of the Parent Company (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating expenses | ||||||||||
Revenue | $ 24,985,717 | $ 26,723,657 | $ 33,149,190 | $ 1,888,194 | $ 35,439,183 | $ 33,507,053 | $ 22,787,683 | $ 25,289,659 | $ 86,746,758 | $ 117,023,578 |
Selling, general and administrative expenses | 13,098,373 | 11,307,395 | ||||||||
Loss from Operations | (5,080,753) | (1,570,353) | (11,730) | (4,519,478) | (1,674,877) | 2,719,550 | 764,016 | 2,871,578 | (11,182,314) | 4,680,267 |
(Loss)/ Income before Income Taxes | (12,396,612) | 2,322,616 | ||||||||
Provision for Income Taxes | (1,850,928) | 662,828 | ||||||||
Net Income | $ (5,164,440) | $ (1,404,962) | $ 109,994 | $ (4,086,276) | $ (1,636,333) | $ 1,572,335 | $ 15,917 | $ 1,707,869 | (10,545,684) | 1,659,788 |
Total Comprehensive Income (loss) | (19,278,435) | 12,569,978 | ||||||||
Parent Company [Member] | ||||||||||
Operating expenses | ||||||||||
Revenue | ||||||||||
Selling, general and administrative expenses | 895,995 | 402,579 | ||||||||
Loss from Operations | (895,995) | (402,579) | ||||||||
Equity in (loss)/ earnings of unconsolidated subsidiaries | (9,641,498) | 2,068,895 | ||||||||
Other Income (Expense) | ||||||||||
(Loss)/ Income before Income Taxes | (10,537,493) | 1,666,316 | ||||||||
Provision for Income Taxes | (8,189) | (6,528) | ||||||||
Net Income | (10,545,682) | 1,659,788 | ||||||||
Other comprehensive income /(loss) | (9,974,338) | 10,910,190 | ||||||||
Total Comprehensive Income (loss) | $ (19,298,598) | $ 12,569,978 |
Condensed Financial Informati_5
Condensed Financial Information of the Parent Company (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Net Cash (Used in) Provided by Operating Activities | $ 9,790,613 | $ 18,151,788 |
Net Cash Used in Investing Activities | (2,198,852) | (9,321,636) |
Net Cash Provided by Financing Activities | (3,165,607) | (4,917,037) |
Net Increase (Decrease) in Cash and Cash Equivalents | 3,099,998 | 4,522,463 |
Cash, Cash Equivalents and Restricted Cash - Beginning of Year | 9,017,427 | 4,494,964 |
Cash, Cash Equivalents and Restricted Cash - End of Year | 12,117,425 | 9,017,427 |
Parent Company [Member] | ||
Net Cash (Used in) Provided by Operating Activities | (425,127) | (402,579) |
Net Cash Used in Investing Activities | ||
Net Cash Provided by Financing Activities | 422,692 | 406,280 |
Net Increase (Decrease) in Cash and Cash Equivalents | (2,435) | 3,701 |
Cash, Cash Equivalents and Restricted Cash - Beginning of Year | 5,158 | 1,457 |
Cash, Cash Equivalents and Restricted Cash - End of Year | $ 2,723 | $ 5,158 |
Condensed Financial Informati_6
Condensed Financial Information of the Parent Company (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Condensed Financial Information of the Parent Company (Textual) | ||
Restricted including paid-in capital, capital surplus and statutory reserves | $ 45,589,643 | $ 45,589,643 |