The China Customer Relations Centers, Inc. (CCRC) stock belongs to Services sector. Shares of China Customer Relations Centers, Inc. (CCRC) were valued at $17.20 and moved 2.87% as of the last closing trade. A total volume of 0.11 million shares traded versus its average traded volume of 0.15 million shares. Institutional owners hold 1.10% stake while Insiders ownership held at 53.82% in the company.
China Consumer Relations Centers, Inc. (NASDAQ: CCRC) reported its financial results for the six months ended June 30, 2017.
Mr. Gary Wang, Chairman and Chief Executive Officer of CCRC, said that The momentum of their business remained strong as the have maintained nearly full capacity during the first half of this year. However, Because of capacity limitations, they were forced to give up on several low priority clients to make room for new clients that included China Merchants Bank, ofo, Rong360.com, TianAn Life Insurance, and J.K. Life Insurance. Because of our business portfolio restructuring, the company revenues were essentially flat year over year while margins and profitability reduced. The minor decline in margins and profitability was primarily Because of higher operating expenses incurred during the first half of this year. Looking ahead,
Revenues
For the six months ended June 30, 2017, revenues raised by $0.3 million, or 0.7%, to $34.7 million from $34.5 million for the same period last year. We continued to see strong demand for our business from existing BPO clients as well as new clients with nearly full seat utilization rate during the six months ended June 30, 2017. We added several high-profile clients, including China Merchants Bank, ofo, Rong360.com, Tianan Life Insurance, and J.K. Life Insurance, and dropped several lower volume clients Because of seat limitations during the six months ended June 30, 2017.
Cost of revenues
Cost of revenues consists primarily of salaries, payroll taxes and employee benefits costs of our consumer service associates and other operations personnel. Cost of revenues also includes direct communications costs, rent expense, information technology costs, and facilities support. Cost of revenues raised by $0.3 million, or 1.4%, to $24.8 million for the six months ended June 30, 2017 from $24.5 million for the same period last year. As a percentage of revenues, cost of revenues was 71.4% for the six months ended June 30, 2017, compared to 70.9% for the same period last year.
Gross profit and gross margin
Gross profit reduced by $0.1 million, or 0.9%, to $9.9 million for the six months ended June 30, 2017 from $10.0 million for the same period last year. Gross margin reduced by 0.5 percentage points to 28.6% for the six months ended June 30, 2017 from 29.1% for the same period last year.
Selling, general and administrative expense
Selling, general and administrative expenses raised by $2.0 million, or 41.2%, to $6.9 million for the six months ended June 30, 2017 from $4.9 million for the same period last year. The raise in selling, general and administrative expenses was a result of higher payroll and bonus expenses paid to the administrative personnel and the management team, and raise in our research and development activities. We anticipate that our administrative expenses, particularly those related to support personnel costs, professional fees, as well as Sarbanes-Oxley compliance, will continue to raise in the second half of 2017Because of the continuing expansion of our business.
Operating income and operating margin
Income from operations reduced by $2.1 million, or 40.6%, to $3.1 million for the six months ended June 30, 2017 from $5.2 million for the same period last year. The decrease in operating income was mainly driven by an raise in selling, general and administrative expenses. Operating margin was 8.8% for the six months ended June 30, 2017, compared to 15.0% for the same period last year.
Other income (expenses)
We received government grants, which are discretionary and unpredictable in nature, of $1.3 million during the six months ended June 30, 2017, compared to $0.4 million during the same period of last year. Government grants as a percentage of net income were 31.0% for the six months ended June 30, 2017, compared to 9.7% for the same period of last year. Total other income, net of other expenses, raised by $1.0 million, or 230.0%, to $1.4 million for the six months ended June 30, 2017, compared to $0.4 million for the same period of last year.
Income before provision for income taxes
Income before provision for income taxes reduced by $1.1 million, or 19.7%, to $4.5 million for the six months ended June 30, 2017 from $5.6 million for the same period of last year. The decrease in income before provision for income taxes was mainly Because of the raise in selling, general and administrative expenses and partially offset by the raise in government grants received.
Income taxes
Provision for income taxes was $0.3 million for the six months ended June 30, 2017, compared to $1.0 million for the same period of last year.
Net income
Net income reduced by $0.3 million, or 7.2%, to $4.2 million for the six months ended June 30, 2017 from $4.6 million for the same period last year. After deducting net income attributable to no controlling interest, net income attributable to ordinary shareholders was $4.0 million, or $0.22 per basic and diluted share, for the six months ended June 30, 2017, compared to $4.6 million, or $0.28 per basic and diluted share, for the same period of last year.
