UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16

OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of April 2018

Commission file number: 001-37655

CHINA CUSTOMER RELATIONS CENTERS, INC.

(Registrant’s name)

c/o Shandong Taiying Technology Co., Ltd.

1366 Zhongtianmen Dajie, Xinghuo Science and Technology Park, High-tech Zone, Taian City, Shandong Province,
People’s Republic of China 27100

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F  ☒  Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

Explanatory Note:

On April 27, 2018, China Customer Relations Centers, Inc. issued a press release announcing its financial results for the six and twelve months ended December 31, 2017. A copy of the press release is attached hereto as Exhibit 99.1

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: April 30, 2018

EXHIBIT INDEX

3

Exhibit 99.1

China Customer Relations Centers, Inc. Announces Second Half and Full Year 2017 Financial Results

TAI’AN, China, Apr. 27, 2018 /PRNewswire/ -- China Customer Relations Centers, Inc. (NASDAQ: CCRC) (“CCRC” or the “Company”), a leading call center business process outsourcing (“BPO”) service provider in China, today announced its financial results for the six and twelve months ended December 31, 2017.

Second Half 2017 Highlights (all comparisons to prior year unless noted)

Full Year 2017 Highlights

Mr. Gary Wang, Chairman and Chief Executive Officer of CCRC, commented, “We are very pleased to report strong results with record revenues and net income for both the second half and full year of 2017. While our relationships with existing customers, including the provincial subsidiaries of China Mobile and China Telecom, remained steady and strong, we continued to attract high-profile new customers, adding China Merchants Bank, Shouqi Limousine & Chauffeur, OFO Shared Bicycles, Tmall.com, and TianAn Life Insurance during 2017.”

Mr. Wang continued, “Looking ahead, as we continue to expand our service capacity and geographical footprint, we are excited about the prospects of our business and expect the strong growth momentum to continue in 2018 and beyond.”

Six Months Ended December 31, 2017 Financial Results (Unaudited)

Revenues

For the six months ended December 31, 2017, revenues increased by $15.9 million, or 41.8%, to $54.2 million from $38.3 million for the same period of the prior year. We continued to see strong demand for our business from existing BPO clients as well as new clients during the six months ended December 31, 2017.

Cost of revenues

Cost of revenues consists primarily of salaries, payroll taxes and employee benefits costs of our customer 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 increased by $12.1 million, or 42.3%, to $40.8 million for the six months ended December 31, 2017 from $28.7 million for the same period of the prior year. As a percentage of revenues, cost of revenues was 75.2% for the six months ended December 31, 2017, compared to 74.9% for the same period of the prior year.

Gross profit and gross margin

Gross profit increased by $3.9 million, or 40.2%, to $13.5 million for the six months ended December 31, 2017 from $9.6 million for the same period of the prior year. Gross margin decreased by 0.3 percentage points to 24.8% for the six months ended December 31, 2017 from 25.1% for the same period of the prior year.

Selling, general and administrative expense

Selling, general and administrative expenses increased by $1.7 million, or 27.0%, to $7.9 million for the six months ended December 31, 2017 from $6.2 million for the same period of the prior year. The increase in selling, general and administrative expenses was a result of higher payroll and bonus expenses paid to the administrative and research personnel and the management team. We anticipate that our administrative expenses, particularly those related to support personnel costs, professional fees, as well as Sarbanes-Oxley compliance, will continue to increase in 2018 due to the continuing expansion of our business.

Operating income and operating margin

Income from operations increased by $2.2 million, or 64.4%, to $5.6 million for the six months ended December 31, 2017 from $3.4 million for the same period of the prior year. The increase in operating income was mainly driven by an increase in revenues and partially offset by increases in selling, general and administrative expenses. Operating margin was 10.3% for the six months ended December 31, 2017, compared to 8.9% for the same period of the prior year.

Other income (expenses)

We received government grants, which are discretionary and unpredictable in nature, of $0.6 million during the six months ended December 31, 2017, compared to $0.4 million during the same period of the prior year. Government grants as a percentage of net income were 11.8% for the six months ended December 31, 2017, compared to 9.6% for the same period of the prior year. Total other income, net of other expenses, decreased by $0.4 million, or 58.9%, to $0.3 million for the six months ended December 31, 2017 from $0.7 million for the same period of the prior year.

Income before provision for income taxes

Income before provision for income taxes increased by $1.8 million, or 41.7%, to $5.9 million for the six months ended December 31, 2017 from $4.1 million for the same period of the prior year. The increase in income before provision for income taxes was mainly due to the increase in income from operations and partially offset by decrease in other income.

Income taxes

Provision for income taxes was $1.0 million for the six months ended December 31, 2017, compared to $0.4 million for the same period of the prior year.

Net income and earnings per share

Net income increased by $1.2 million, or 31.3%, to $4.9 million for the six months ended December 31, 2017 from $3.7 million for the same period of the prior year. After deducting net income attributable to noncontrolling interest, net income attributable to common shareholders was $4.7 million, or $0.26 per basic and diluted share, for the six months ended December 31, 2017, compared to $3.7 million, or $0.20 per basic and diluted share, for the same period of the prior year.

Fiscal Year 2017 Financial Results

Revenues

For the year of 2017, revenues increased by $16.2 million, or 22.3%, to $89.0 million from $72.7 million for 2016. We continued to see strong demand for our business from existing BPO clients as well as new clients during the six months ended December 31, 2017. We added several high-profile clients, including China Merchants Bank, OFO Shared Bicycles, Rong360.com, and TianAn Life Insurance, and dropped several lower volume clients due to seat limitations during 2017. 

The provincial subsidiaries of China Mobile and China Telecom remained the two largest customers and accounted for 28% and 9%, respectively, of total revenues in 2017, compared to 34% and 14%, respectively, of total revenues in 2016. Top 5 customers accounted for 57% of revenues in 2017, compared to 71% of revenues in 2016.

Cost of revenues

Cost of revenues consists primarily of salaries, payroll taxes and employee benefits costs of our customer 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 increased by $12.5 million, or 23.5%, to $65.6 million for 2017 from $53.1 million for 2016. As a percentage of revenues, cost of revenues was 73.7% for 2017, compared to 73.0% for 2016.

Gross profit and gross margin

Gross profit increased by $3.8 million, or 19.2%, to $23.4 million for 2017 from $19.6 million for 2016. Gross margin decreased by 0.7 percentage points to 26.3% for 2017 from 27.0% for 2016.

Selling, general and administrative expense

Selling, general and administrative expenses increased by $3.7 million, or 33.2%, to $14.8 million for 2017 from $11.1 million for 2016. The increase in selling, general and administrative expenses was a result of higher payroll and bonus expenses paid to the administrative and research personnel and the management team. We anticipate that our administrative expenses, particularly those related to support personnel costs, professional fees, as well as Sarbanes-Oxley compliance, will continue to increase in 2018 due to the continuing expansion of our business.

Operating income and operating margin

Income from operations increased by $0.1 million, or 1.1%, to $8.64 million for 2017 from $8.55 million for 2016. The increase in operating income was mainly driven by an increase in gross profit and partially offset by increases in selling, general and administrative expenses. Operating margin was 9.7% for 2017, compared to 11.8% for 2016.

Other income (expenses)

We received government grants, which are discretionary and unpredictable in nature, of $1.9 million during 2017, compared to $0.8 million during 2016. Government grants as a percentage of net income were 20.7% for 2017, compared to 9.7% for 2016. Total other income, net of other expenses, increased by $0.6 million, or 47.1%, to $1.7 million for 2017 from $1.2 million for 2016.

Income before provision for income taxes

Income before provision for income taxes increased by $0.6 million, or 6.6%, to $10.4 million for 2017 from $9.7 million for 2016. The increase in income before provision for income taxes was mainly due to the increase in other income as well as slight increase in income from operations.

Income taxes

Provision for income taxes was $1.3 million for 2017, compared to $1.4 million for 2016.

Net income and earnings per share

Net income increased by $0.8 million, or 10.1%, to $9.1 million for 2017 from $8.3 million for 2016. After deducting net income attributable to noncontrolling interest, net income attributable to common shareholders was $8.8 million, or $0.48 per basic and diluted share, for 2017, compared to $8.3 million, or $0.45 per basic and diluted share, for 2016.

Financial Conditions

As of December 31, 2017, the Company had cash of $18.6 million, compared to $15.9 million at December 31, 2016. Total working capital was $30.0 million as of December 31, 2017, compared to $23.2 million at the end of 2016.

Net cash provided by operating activities was $3.0 million for 2017, compared to $5.7 million for 2016. Net cash used in investing activities was $4.9 million for 2017, compared to $1.0 million for 2016. Net cash provided by financing activities was $3.7 million for 2017, compared to net cash used in financing activities of $1.5 million for 2016.

Recent Development

On September 16, 2017, The Company held its 2017 Annual Meeting of Shareholders at its headquarters in Taian City, Shandong Province.  The Company’s shareholders: 1) ratified the appointment of MaloneBailey, LLC as its independent registered public accounting firm for the fiscal year of 2017; and 2) reelected Jie Xu and Tianjun Zhang as Class I Directors.

Notice

Rounding amounts and percentages: Certain amounts and percentages included in this press release have been rounded for ease of presentation. Percentage figures included in this press release have not in all cases been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. For this reason, certain percentage amounts in this press release may vary from those obtained by performing the same calculations using the figures in the financial statements. In addition, certain other amounts that appear in this press release may not sum due to rounding.

About China Customer Relations Centers, Inc.

The Company is a BPO service provider focusing on the complex, voice-based segment of customer care services, including:

The Company’s service is currently delivered from call centers located at over 20 cities across 12 provinces, autonomous regions and municipalities in China, including Shandong, Jiangsu, Anhui, Hebei, Xinjiang, Guangxi, Jiangxi, Chongqing, Beijing, Henan, Shanghai and Sichuan. More information about the Company can be found at: www.ccrc.com.

Forward-Looking Statement

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as “may,” “will,” “intend,” “should,” “believe,” “expect,” “anticipate,” “project,” “estimate” or similar expressions that do not relate solely to historical matters, it is making forward-looking statements.  Specifically, the Company’s statements regarding its: 1) expansion of its service capacity and geographical footprint; 2) anticipated increase in administrative costs; and 3) continued growth and business outlook, are forward-looking statements.  Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company’s expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the following:  the Company’s goals and strategies; the Company’s future business development; product and service demand and acceptance; changes in technology; economic conditions; the growth of the call center business process outsourcing market in China; reputation and brand; the impact of competition and pricing; government regulations; fluctuations in general economic and business conditions in China and assumptions underlying or related to any of the foregoing and other risks contained in reports filed by the Company with the Securities and Exchange Commission.  For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company’s filings with the U.S. Securities and Exchange Commission, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

For more information, please contact:

Tony Tian, CFA
Weitian Group LLC
Email: tony.tian@weitian-ir.com
Phone: +1-732-910-9692

CHINA CUSTOMER RELATIONS CENTERS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS 

CHINA CUSTOMER RELATIONS CENTERS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

CHINA CUSTOMER RELATIONS CENTERS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS 

9