LOS ANGELES, May 14, 2018 (GLOBE NEWSWIRE) -- Nova LifeStyle, Inc. (NASDAQ:NVFY), a leading U.S.-based, innovative designer and distributor of modern LifeStyle home products, today announced financial results for the first quarter ended March 31, 2018.

First Quarter 2018 Financial Highlights (all comparisons are to the same period of the prior year):

-- First quarter revenues were $22.3 million, up 23.5%, compared to $18.1 million. -- Net income in the first quarter of 2018 was $1.6 million, or $0.06 per diluted share, compared with a net loss of $(1.2) million in the first quarter of 2017, resulting in an EPS loss of $(0.04). -- Gross profit for the first quarter was $4.9 million, up 81.4%, compared to $2.7 million. -- First quarter Gross Margin was 22.0%, compared to 15.0% in the prior year period due as the Company continued to drive its sales mix to favor higher-margin, premium products. -- U.S. domestic sales to major online outlets continue to expand rapidly, benefiting from recent U.S. tax law changes. -- Anticipate robust sales and earnings growth throughout 2018.

Management Commentary

Tawny Lam, Chief Executive Officer of Nova LifeStyle, commented, "Nova Lifestyle is pleased to announce fantastic first quarter 2018 financial results. Since the beginning of 2018, Nova LifeStyle’s focus on marketing trendy designed, high-end products in our catalogues has attracted large orders from global customers. Our outstanding financial results are driven by sales increase across nearly all product categories, with online sales continuing to anchor our growth. This was a well-executed quarter with plenty of growth opportunities going forward.”

“Nova LifeStyle entered 2018 with strong growth momentum. We have the latest product designs and deeper brand penetration for our popular Diamond Sofa brand. Since the Company was founded nearly 30 years ago, Diamond sofa has continued to innovate with new product offerings. We anticipate significant earnings growth in 2018.”

About Nova LifeStyle

Nova LifeStyle, Inc., a NASDAQ Global Market listed company headquartered in California and founded nearly 30 years ago, is a fast growing, innovative designer and distributor of modern LifeStyle residential and commercial furniture products: sofas, dining rooms, cabinets, office furniture and related components, bedrooms, and various accessories in matching collections. Nova's products are made in the US, Europe, and Asia that include LifeStyle brands such as Diamond Sofa, Nova QwiK, and Bright Swallow International. Nova's products feature urban contemporary styles that integrate comfort and functionality, incorporating upscale luxury designs appeals to middle and upper middle-income consumers in the U.S., China, Europe, and elsewhere in the world. Visit Nova LifeStyle’s website at www.NovaLifeStyle.com.

Safe Harbor Statement

All statements in this press release that are not historical are forward-looking statements made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. There can be no assurance that actual results will not differ from the company's expectations. You are cautioned not to place undue reliance on any forward-looking statements in this press release as they reflect Nova's current expectations with respect to future events and are subject to risks and uncertainties that may cause actual results to differ materially from those contemplated. Potential risks and uncertainties include, but are not limited to, the risks described in Nova's filings with the Securities and Exchange Commission.

Company Contact:Investor Relations:The Equity Group Inc.In U.S.Adam Prior, Senior Vice President+1 (212) 836-9606 aprior@equityny.com

NOVA LIFESTYLE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME FOR THE THREE MONTHS ENDED MARCH 31, 2018 AND 2017 (UNAUDITED) Three Months Ended March 31, 2018 2017 - ---------- - - ---------- - Net Sales $ 22,303,472 $ 18,057,022 Cost of Sales 17,401,930 15,355,247 - ---------- - - ---------- - Gross Profit 4,901,542 2,701,775 - ---------- - - ---------- - Operating Expenses Selling expenses 631,153 975,002 General and administrative expenses 2,305,673 3,025,676 - ---------- - - ---------- - Total Operating Expenses 2,936,826 4,000,678 - ---------- - - ---------- - Income(Loss)From Operations 1,964,716 (1,298,903 ) - ---------- - - ---------- - Other Income (Expenses) Foreign exchange transaction loss (136 ) (40 ) Interest expense, net (31,582 ) (54,406 ) Financial expense (30,720 ) (26,060 ) - ---------- - - ---------- - Total Other Expenses, Net (62,438 ) (80,506 ) - ---------- - - ---------- - Income(Loss)Before Income Taxes 1,902,278 (1,379,409 ) Income Tax Expense (Benefit) 247,257 (170,019 ) - ---------- - - ---------- - Net Income (Loss) and Comprehensive Income (Loss) $ 1,655,021 $ (1,209,390 ) - ---------- - - ---------- - Basic weighted average shares outstanding 28,253,115 27,345,106 - ---------- - - ---------- - Diluted weighted average shares outstanding 28,693,479 27,345,106 - ---------- - - ---------- - Net income (loss) per share of common stock Basic $ 0.06 $ (0.04 ) - ---------- - - ---------- - Diluted $ 0.06 $ (0.04 ) - ---------- - - ---------- -

NOVA LIFESTYLE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS MARCH 31, 2018 (UNAUDITED) AND DECEMBER 31, 2017 March 31, December 31, 2018 2017 ------------ ------------ Assets Current Assets Cash and cash equivalents $ 1,121,170 $ 5,722,716 Accounts receivable, net 54,625,956 54,006,513 Advance to suppliers 10,762,192 8,580,609 Inventories 6,220,820 6,374,560 Prepaid expenses and other receivables 171,197 232,935 - ---------- - ---------- Total Current Assets 72,901,335 74,917,333 - ---------- - ---------- Noncurrent Assets Plant, property and equipment, net 158,405 157,246 Lease deposit 43,260 43,260 Goodwill 218,606 218,606 Intangible assets, net 4,100,932 4,202,608 Deferred tax asset 318,961 318,961 - ---------- - ---------- Total Noncurrent Assets 4,840,164 4,940,681 - ---------- - ---------- Total Assets $ 77,741,499 $ 79,858,014 ------------ ------------ Liabilities and Stockholders' Equity Current Liabilities Accounts payable $ 1,338,898 $ 1,634,554 Advance from customers 43,221 19,826 Accrued liabilities and other payables 733,362 847,756 Income tax payable 393,861 178,307 - ---------- - ---------- Total Current Liabilities 2,509,342 2,680,443 - ---------- - ---------- Noncurrent Liabilities Line of credit - 4,202,118 Income tax payable 4,559,553 4,527,849 - ---------- - ---------- Total Noncurrent Liabilities 4,559,553 8,729,967 - ---------- - ---------- Total Liabilities 7,068,895 11,410,410 - ---------- - ---------- Contingencies and Commitments Stockholders' Equity Common stock, $0.001 par value; 75,000,000 shares authorized, 28,301,738 and 27,309,695 shares issued and outstanding; 28,302 28,192 as of March 31, 2018 and December 31, 2017, respectively Additional paid-in capital 39,252,246 38,682,377 Statutory reserves 6,241 6,241 Retained earnings 31,385,815 29,730,794 - ---------- - ---------- Total Stockholders' Equity 70,672,604 68,447,604 - ---------- - ---------- Total Liabilities and Stockholders' Equity $ 77,741,499 $ 79,858,014 - ---------- - ----------

NOVA LIFESTYLE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2018 AND 2017 (UNAUDITED) Three Months Ended March 31, 2018 2017 ------------- ------------- Cash Flows From Operating Activities Net income (loss) $ 1,655,021 $ (1,209,390 ) Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization 112,017 381,119 Deferred tax benefit 31,704 (188,117 ) Stock compensation expense 595,677 449,889 Termination cost on Academic E-commerce platform (Note 6) -- 800,000 Changes in bad debt allowance 321,970 324,684 Changes in operating assets and liabilities: Accounts receivable (941,413 ) 16,614,186 Advance to suppliers (2,181,584 ) (7,444,924 ) Inventories 153,740 489,152 Other current assets 35,452 112,991 Accounts payable (295,656 ) (1,458,241 ) Advance from customers 23,395 21,529 Accrued liabilities and other payables (113,806 ) (151,606 ) Taxes payable 215,554 18,097 - ----------- - ----------- Net Cash (Used in) Provided by Operating Activities (387,929 ) 8,759,369 - ----------- - ----------- Cash Flows From Investing Activities Assignment fee received -- 1,250,000 Purchase of property and equipment (11,499 ) (2,132 ) Advances to unrelated parties -- (8,835,000 ) - ----------- - ----------- Net Cash Used in Investing Activities (11,499 ) (7,587,132 ) - ----------- - ----------- Cash Flows From Financing Activities Proceeds from line of credit and bank loan 15,923,479 15,469,342 Repayment to line of credit and bank loan (20,125,597 ) (18,939,032 ) - ----------- - ----------- Net Cash Used in Financing Activities (4,202,118 ) (3,469,690 ) - ----------- - -----------

NOVA LIFESTYLE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED) FOR THE THREE MONTHS ENDED MARCH 31, 2018 AND 2017 (UNAUDITED) Three Months Ended March 31, 2018 2017 ------------- ------------- Effect of Exchange Rate Changes on Cash and Cash Equivalents - - Net decrease in cash and cash equivalents (4,601,546) (2,297,453) Cash and cash equivalents, beginning of period 5,722,716 2,587,743 - ----------- - ----------- Cash and cash equivalents, end of period $ 1,121,170 $ 290,290 - ----------- - ----------- Analysis of cash and cash equivalents Included in cash and cash equivalents per consolidated balance sheets 1,121,170 290,290 - ----------- - ----------- Cash and cash equivalents, end of period $ 1,121,170 $ 290,290 - ----------- - ----------- Supplemental Disclosure of Cash Flow Information Cash paid during the period for: Income tax payments $ -- $ -- - ----------- - ----------- Interest paid $ 31,582 $ 54,406 - ----------- - -----------