 | Release: | IMMEDIATE RELEASE | ||||
Contact: |
Cecilia Au-Yeung | |||||
| Global-Tech Advanced Innovations Inc. | ||||||
| Telephone: Hong Kong (852) 2814-0601 | ||||||
| investorrelations@global-webpage.com | ||||||
Web Page: |
http://global-webpage.newshq.businesswire.com | |||||
GLOBAL-TECH ADVANCED INNOVATIONS REPORTS SECOND QUARTER RESULTS FOR FISCAL 2015
Hong Kong, December 15, 2014 — Global-Tech Advanced Innovations Inc. (NASDAQ: GAI) today announced its financial results for the quarter ended September 30, 2014 (the Company’s second quarter of fiscal 2015).
Net sales for the second quarter of fiscal 2015 were $21.1 million, an increase of approximately 76% when compared to $12.0 million for the corresponding quarter in fiscal 2014. Net loss for the second quarter of fiscal 2015 was $2.2 million, or $0.74 per share, compared to a net loss of $5.2 million, or $1.70 per share, for the second quarter of fiscal 2014.
Net sales for the six months ended September 30, 2014 were $45.7 million, an increase of approximately 87% when compared to $24.5 million in the corresponding six-month period in fiscal 2014. Net loss for the first six months of fiscal 2015 was $2.5 million, or $0.83 per share, compared to a net income of $6.7 million, or $2.21 per share, for the first half of fiscal 2014.
John C.K. Sham, the Company’s President and Chief Executive Officer, said: “Sales in our electronic components business experienced growth in the first half of fiscal 2015, with unit sales increasing nearly 120% compared to the previous year; however, concurrent declines in pricing of approximately 30% offset any potential gains in operating results. This is despite an improved product mix of higher-pixel units for our CCMs.”
Mr. Sham continued, “Competition in the electronic business remains high, with new entrants entering the market almost daily. This coupled with the current instability in the industry will require us to reconsider any further investment in additional chip-on-board (COB) production lines.”
Mr. Sham concluded, “The future success of our electronic components business will depend upon our ability to attract new customers and drive volume while at the same time improving margins, whether through the reduction of our manufacturing costs or through increases in price and innovation.”
Global-Tech Advanced Innovations Inc. is a holding company, owning subsidiaries that manufacture and market a diversified portfolio of products, such as complementary metal oxide semiconductor (CMOS) and camera modules (CCMs). The primary focus of its subsidiaries is to develop and market high-quality products for the communications industry in China and export such products to markets in other countries throughout the world.
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Except for historical information, certain statements contained herein areforward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “should,” “estimates,” or variations of such words and similar expressions are intended to identify such forward-looking statements. These forward-looking statements are subject to risks and uncertainties, including but not limited to, the impact of competitive products and pricing, demand for new and existing products in our core business, the financial condition of the Company’s customers, product demand and market acceptance especially of our new products, the success of new product development especially in the area of cellular phone components and solutions, compact camera modules and other pending projects, reliance on material customers, suppliers and key strategic alliances, the terms and conditions of customer contracts and purchase orders, availability and cost of raw materials, the timely and proper execution of certain business plans, including the plan to diversify and transform a portion of manufacturing capacity to higher-value, technology-oriented products, currency fluctuations, including the revaluation of the Chinese Renminbi, the imposition by China’s trading partners of economic sanctions and/or protective tariffs on Chinese manufactured goods, uncertainties associated with investments, the regulatory environment, fluctuations in operating results, the impact of changing global, political and economic conditions and other risks detailed from time to time in the Company’s filings with the U.S. Securities and Exchange Commission including its most recent Report on Form 20-F. The Company does not undertake to update its forward-looking information, or any other information contained or referenced in this press release to reflect future events or circumstances.
GLOBAL-TECH APPLIANCES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts expressed in thousands of United States dollars, except per share data)
| Three Months Ended September 30, | Six Months Ended September 30, | |||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||
Net sales | $ | 21,062 | $ | 11,994 | $ | 45,669 | $ | 24,462 | ||||||||
Cost of goods sold | (20,340 | ) | (11,422 | ) | (43,205 | ) | (22,611 | ) | ||||||||
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Gross profit | 722 | 572 | 2,464 | 1,851 | ||||||||||||
Selling, general and administrative expenses | (3,361 | ) | (3,142 | ) | (6,315 | ) | (5,766 | ) | ||||||||
Other operating income (expense) | — | — | — | — | ||||||||||||
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Operating income (loss) | (2,639 | ) | (2,570 | ) | (3,851 | ) | (3,915 | ) | ||||||||
Interest income, net | 85 | 170 | 189 | 302 | ||||||||||||
Other income (expense), net | 406 | 572 | 1,323 | 1,400 | ||||||||||||
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Income (loss) from continuing operations before income taxes | (2,148 | ) | (1,828 | ) | (2,339 | ) | (2,213 | ) | ||||||||
Income tax expenses | (103 | ) | (66 | ) | (227 | ) | (30 | ) | ||||||||
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Income (loss) from continuing operations | (2,251 | ) | (1,894 | ) | (2,566 | ) | (2,243 | ) | ||||||||
Income (loss) from discontinued operations, net of tax | — | (3,320 | ) | — | (4,537 | ) | ||||||||||
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Net income (loss) | (2,251 | ) | (5,214 | ) | (2,566 | ) | (6,780 | ) | ||||||||
Net income (loss) attributable to non-controlling interests | 15 | 47 | 30 | 73 | ||||||||||||
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Net income (loss) attributable to shareholders | $ | (2,236 | ) | $ | (5,167 | ) | $ | (2,536 | ) | $ | (6,707 | ) | ||||
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Basic earnings (loss) per common share | $ | (0.74 | ) | $ | (1.70 | ) | $ | (0.83 | ) | $ | (2.21 | ) | ||||
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Diluted earnings (loss) per common share | $ | (0.74 | ) | $ | (1.70 | ) | $ | (0.83 | ) | $ | (2.21 | ) | ||||
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Basic and diluted weighted average number of shares outstanding | 3,042 | 3,040 | 3,042 | 3,040 | ||||||||||||
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GLOBAL-TECH ADVANCED INNOVATIONS INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Amounts expressed in thousands of United States dollars)
| September 30, 2014 | ||||||||
| Sept 30, 2014 | March 31, 2014 | |||||||
| (unaudited) | (audited) | |||||||
| ASSETS | ||||||||
Current assets: | ||||||||
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Cash and cash equivalents | $ | 15,732 | $ | 22,820 | ||||
Time deposits | 12,115 | 11,340 | ||||||
Restricted cash | 4,185 | 4,014 | ||||||
Available-for-sale investments | 1,052 | 1,050 | ||||||
Accounts and bills receivable, net | 24,624 | 21,217 | ||||||
Inventories | 10,464 | 7,163 | ||||||
Prepaid expenses | 205 | 123 | ||||||
Deposits and other assets | 3,223 | 2,476 | ||||||
Amount due from a related party | 15 | 13 | ||||||
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Total current assets | 71,615 | 70,216 | ||||||
Interests in jointly-controlled entities | — | — | ||||||
Property, plant and equipment, net | 25,837 | 26,317 | ||||||
Land use rights, net | 2,901 | 2,923 | ||||||
Deposits paid for purchase of property, plant and equipment | 302 | 212 | ||||||
Available for sales investments | — | — | ||||||
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Total assets | $ | 100,655 | $ | 99,668 | ||||
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LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Short-term bank loans | 9,054 | 7,280 | ||||||
Accounts payable | 13,256 | 12,520 | ||||||
Customer deposits | 1,135 | 1,138 | ||||||
Accrued salaries, allowances and other employee benefits | 3,126 | 2,981 | ||||||
Other accrued liabilities | 6,161 | 5,721 | ||||||
Income tax payable | 4,460 | 4,233 | ||||||
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Total current liabilities | 37,192 | 33,873 | ||||||
Deferred tax liabilities | 5 | 5 | ||||||
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Total liabilities | 37,197 | 33,878 | ||||||
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Shareholders’ equity: | ||||||||
Common stock, par value $0.04 per share; 12,500,000 shares authorized; 3,233,814 shares issued as of September 30 and March 31, 2014 | 129 | 129 | ||||||
Additional paid-in capital | 85,104 | 85,104 | ||||||
Statutory reserves | 1,340 | 1,340 | ||||||
Accumulated deficit | (29,126 | ) | (26,590 | ) | ||||
Accumulated other comprehensive income | 11,089 | 10,855 | ||||||
Less: Treasury stock, at cost, 189,587 shares as of September 30 and March 31, 2014 | (4,663 | ) | (4,663 | ) | ||||
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Total Global-Tech Advanced Innovations Inc. shareholders’ equity | 63,873 | 66,175 | ||||||
Non-controlling interests | (415 | ) | (385 | ) | ||||
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Total equity | 63,458 | 65,790 | ||||||
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Total liabilities and shareholders’ equity | $ | 100,655 | $ | 99,668 | ||||
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