Plastec Technologies (PLTYF) 6-K FY 2012 Q3 Financial Highlights

Plastec Technologies, Ltd.

plastec technologies Reports Unaudited FISCAL 2012 Third quarter financial results

FY 2012 Q3 Financial Highlights

· Sales of $31.8 million

· Gross margin of 7.6%

· EBITDA of $5.1 million

· Net income of $0.21 million, or $0.01 per diluted share

Fiscal 2012 Nine Month Financial Highlights

· Sales of $124.9 million

· Gross margin of 11.5%

· EBITDA of $21.4 million

· Net income of $4.4 million, or $0.27 per diluted share

· $21.9 million cash generated from operations for the nine months ended January 31, 2012

Balance Sheet Highlights

· As of January 31, 2012, cash and cash equivalents of $21.2 million; working capital of $16.5 million; no long-term debt; and shareholders’ equity of $89.2 million.

Hong Kong – March 19, 2012 – Plastec Technologies, Ltd. (OTCBB: PLTYF (common stock), PLTWF (warrants), PLTEF (units), (“Plastec” or the “Company”), an integrated plastic manufacturing services provider that operates in the People’s Republic of China, announced today its unaudited financial results for the fiscal 2012 third quarter and nine months ended January 31, 2012. The Company operates on an April 30^th fiscal year.

See attached tables at the end of this release in Hong Kong Dollars (HKD). All other amounts in this press release are presented in U.S. dollars (USD) with a conversion rate of US$1.0: HK$7.8 (see table below).

Plastec Technologies, Ltd.

Selected Financial Statements in USD ($ in millions, except per share data)

	3 months ended 1/31/2012			3 months ended 1/31/2011			9 months ended 1/31/2012			9 months ended 1/31/2011
Sales	$	31.8		$	42.0		$	124.9		$	128.3
Cost of Revenues		29.4			33.7			110.5			103.1
Gross Profit		2.4			8.4			14.3			25.2
Gross Margin		7.6	%		19.9	%		11.5	%		19.6	%
Income from Operations		0.08			6.3			6.6			17.9
Net Income		0.21			5.3			4.4			15.0
Diluted EPS		0.01			0.65			0.27			2.03
EBITDA		5.1			10.5			21.4			31.0

Plastec Technologies Ltd.	Page 2
March 19, 2012

Mr. Kin Sun Sze-To, Chairman of Plastec, stated, “Under the difficult economic conditions in our industry, we achieved a breakeven result in the third quarter. Our sales were affected by a slowdown in the market for electronic exports that utilize Plastec’s precision plastic molding services. In addition, our company was affected by the confluence of two major catastrophic events, the Japanese Tsunami and flooding in Thailand. The Japanese tsunami indirectly caused widespread disruption to electronics production globally, and the flooding in Thailand led to a significant shortage of necessary components in manufacturing. This caused a delay from our major customers in introducing new products to the marketplace. Despite these abnormal events, we were able to continue to operate profitably and generate cash from our operations. We also have benefitted from a strong financial position, with approximately $21.2 million in cash as of January 31, 2012. While in the short-term these disruptions impacted our bottom line, we continue to invest our capital back into the business through the purchase of new machines and through expansion at our Shenzhen manufacturing facility. We are also evaluating opportunities in expanding our manufacturing capacities in other countries, but only as appropriate to the Company’s long-term goals of complementing our leading position in the plastic-molding industry.”

Fiscal Year 2012 Third Quarter Financial Review

· The Company’s total sales for the three months ended January 31, 2012 were $31.8 million, compared to $42.0 million in the prior year period. Plastec’s sales decrease was due to the slow market conditions and electronic component shortages mentioned above.

· The Company’s gross profit margin for the three months ended January 31, 2012 was 7.6%, compared to 19.9% in the prior-year period due to increased wages, factory overheads for the increasing cost of labor and inflation.

· EBITDA for the three months ended January 31, 2012, was $5.1 million, compared to $10.5 million in the prior three-month period.

· Net income for the three months ended January 31, 2012 was $0.21 million, or $0.01 per share based on a weighted average number of diluted shares outstanding of 15.7 million, compared to $5.3 million, or $0.65 per share based on 8.2 million weighted average number of diluted shares, in the prior-year period.

Fiscal 2012 Nine MonthFinancial Review

· The Company’s total sales for the nine months ended January 31, 2012 decreased 2.7% to $124.9 million from $128.3 million.

· The Company’s gross profit margin during the nine months ended January 31, 2012 decreased 11.5% compared to 19.6% same period last year, due to increased wages, factory overheads for the increasing cost of labor and inflation.

· EBITDA for the nine months ended January 31, 2012 was $21.4, compared to $31.0 in the prior year period.

Plastec Technologies Ltd.	Page 3
March 19, 2012

· Net income for the nine months ended January 31, 2012 was $4.4 million, or $0.27 per share based on a weighted average number of diluted shares outstanding of 16.4 million, compared to $15.0 million, or $2.03 per share based on 7.4 million weighted average number of diluted shares, in the prior-year period.

About Plastec

Originally founded in 1993 by Chairman and CEO, Mr. Kin Sun Sze-To, Plastec is an integrated plastic manufacturing services provider that operates in the People’s Republic of China through its wholly owned subsidiaries. With approximately 5,500 employees, Plastec currently operates 6 separate, high-output, low-defect facilities (with gross floor areas of approximately 167,000 square meters) in 5 locations in Guangdong province in Southern China and Jiangsu province in Eastern China. Plastec provides precision plastic manufacturing services from mold design and fabrication, plastic injection manufacturing to secondary-process finishing, as well as parts assembly.

Forward Looking Statements

This press release contains “forward-looking statements.” These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Actual results may differ from expectations, estimates and projections and, consequently, you should not rely on these forward looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements.

CONTACT:
Plastec Technologies, Ltd.	INVESTO RELATIONS
Eli D. Scher	The Equity Group Inc.
Director	Adam Prior
eli@plastec.com.hk	Vice President
	(212) 836-9606
	aprior@equityny.com
HL Ning	Katherine Yao
Chief Financial Officer	Account Executive
ning@plastec.com.hk	+86 10-6587-6435
	kyao@equityny.com

Plastec Technologies Ltd.	Page 4
March 19, 2012

PLASTEC TECHNOLOGIES, LTD.

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED)

(Hong Kong dollars in thousands, except number of shares, per share data and unless otherwise stated)

	For the 3 months ended						For the 9 months ended
	January 31,						January 31,
	2012			2011			2012			2011
	HK$			HK$			HK$			HK$
Revenue		248,127			327,976			973,941			1,000,578
Cost of revenues		(229,227	)		(262,661	)		(862,245	)		(804,296	)
Gross profit		18,900			65,315			111,696			196,282
Operating expenses
Selling, general and administrative expenses		(18,759	)		(20,522	)		(62,460	)		(60,279	)
Other income		418			4,075			1,637			4,670
Gain/(loss) on disposal of property, plant and equipment		51			(28	)		190			(956	)
Total operating expenses, net		(18,290	)		(16,475	)		(60,633	)		(56,565	)
Income from operations		610			48,840			51,063			139,717
Interest income		59			38			174			76
Interest expense		(626	)		(852	)		(2,067	)		(2,205	)
Income before income tax expense		43			48,026			49,170			137,588
Income tax expense (note)		1,598			(6,729	)		(15,049	)		(20,260	)
Net income		1,641			41,297			34,121			117,328
Other comprehensive income
Foreign currency translation adjustment		19			(35	)		7,157			218
Comprehensive income attributable to Plastec Technologies, Ltd.		1,660			41,262			41,278			117,546
Weighted average number of ordinary shares		15,692,218			8,174,291			16,386,203			7,427,819
Weighted average number of diluted ordinary shares		15,692,218			8,174,291			16,386,203			7,427,819
Basic earnings per share attributable to Plastec Technologies, Ltd.		HK$0.1			HK$5.1			HK$2.1			HK$15.8
Diluted earnings per share attributable to Plastec Technologies, Ltd.		HK$0.1			HK$5.1			HK$2.1			HK$15.8

* Note: Income tax expenses for the 3 and 9 months ended January 31, 2012 included tax adjustments for HK$2,431 and HK$7,293 for additional tax payable under enterprise income tax in China respectively.

Plastec Technologies Ltd.	Page 5
March 19, 2012

PLASTEC TECHNOLOGIES, LTD.

CONSOLIDATED BALANCE SHEETS

(Hong Kong dollars in thousands, except number of shares, per share data and unless otherwise stated)

	As of		As of
	January 31, 2012		April 30, 2011
	HK$		HK$
	(Unaudited)		(Audited)
ASSETS
Current assets
Cash and cash equivalents		165,464		219,757
Trade receivables, net of allowances for doubtful accounts of HK$nil and HK$nil as of Jan 31 2012 and Apr 30 2011 respectively		239,657		270,763
Inventories		137,896		117,733
Deposits, prepayment and other receivables		16,418		8,357
Total current assets		559,435		616,610
Property, plant and equipment, net		544,344		551,079
Prepaid lease payment, net		25,140		26,237
Other assets		11,550		8,001
Intangible asset		438		-
Total assets		1,140,907		1,201,927
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Bank borrowings		148,010		169,710
Capital lease obligations		1,158		5,311
Trade payables		107,497		127,987
Other payables and accruals		103,199		80,811
Tax payable		70,847		56,389
Total current liabilities		430,711		440,208
Capital lease obligations		-		303
Deferred tax liabilities		14,504		15,156
Total liabilities		445,215		455,667
Shareholders' equity
Ordinary shares (US$0.001 par value; 100,000,000 shares authorized,		118		131
15,163,196 shares and 16,733,196 shares issued and outstanding
as of January 31,2012 and April 30, 2011 respectively)
Additional paid-in capital		78,140		169,973
Accumulated other comprehensive income		15,263		8,106
Retained earnings		602,171		568,050
Total Plastec Technologies, Ltd. shareholders' equity		695,692		746,260
Total liabilities and shareholders' equity		1,140,907		1,201,927

Plastec Technologies Ltd.	Page 6
March 19, 2012

PLASTEC TECHNOLOGIES, LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(Hong Kong dollars in thousands, except number of shares, per share data and unless otherwise stated)

	For the 9 months ended
	January 31,
	2012			2011
	HK$			HK$
Operating activities
Net Income after taxation		34,121			117,328
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		117,900			104,933
Gain on disposals prepaid leases		-			(3,798	)
Loss on written property, plant and equipment		690			-
Loss/(gain) on disposals property, plant and equipment		(879	)		956
Deferred liabilities charge		(652	)		-
Change in operating assets
Account receivables		25,372			(25,428	)
Inventories		(20,163	)		(51,139	)
Deposits and other receivables		(8,062	)		3,073
Account payables		(14,757	)		7,152
Other payables and accruals		22,394			15,804
Tax payables		14,458			24,867
Net cash provided by operating activities		170,422			193,748
Investing activities
Purchase of property, plant and equipment		(103,998	)		(171,511	)
Purchase of intangible assets		(438	)		-
Proceeds from disposals of prepaid leases		-			3,926
Proceeds from disposals of property, plant and equipment		2,187			1,925
Deposits for purchases of property, plant and equipment		(11,552	)		(12,650	)
Net cash used in investing activities		(113,801	)		(178,310	)
Financing activities
Repurchase of shares		(91,846	)		-
Net cash inflow from the Merger transaction		-			58,160
Proceeds from bank borrowings		273,306			376,019
Repayment of bank borrowings		(295,006	)		(303,010	)
Repayment of capital lease obligations		(4,457	)		(7,615	)
Dividends paid		-			(70,000	)
Net cash provided by/(used in) financing activities		(118,003	)		53,554
Effect of exchange rate changes on cash and cash equivalents		7,089			218
Net increase / (decrease) in cash and cash equivalents		(61,382	)		68,992
Cash and cash equivalents, beginning of period		219,757			151,304
Cash and cash equivalents, end of period		165,464			220,514
Supplementary
interest paid		2,067			2,205
income tax paid		1,243			(4,606	)

Plastec Technologies Ltd.	Page 7
March 19, 2012

RECONCILIATION OF NON-GAAP FINANCIAL MEASURE

A reconciliation of Adjusted EBITDA to net income is provided below:

	3 months ended January 31,						9 months ended January 31,
HKD’000	2012			2011			2012			2011
Net income (Note)	1,172			37,250			32,294			113,614
Plus                  : Interest expenses		626			852			2,067			2,205
Minus              : Interest income		(59	)		(38	)		(174	)		(76	)
Plus                 : Income tax expense		(1,598	)		6,729			15,049			20,260
Income from Operations		141			44,793			49,236			136,003
Plus                  : Depreciation & Amortization		39,735			37,021			117,900			104,933
Adjusted EBITDA		39,876			81,814			167,136			240,936

Note: Excl. Other Incomes and gain/(loss) on disposal

This press release includes financial information (EBITDA) not derived in accordance with generally accepted accounting principles or international financial reporting standards. Plastec believes that the presentation of such financial information provides more useful information to investors as it indicates more clearly Plastec’s future performance. EBITDA was derived by taking earnings before interest expense (net), taxes, depreciation and amortization as adjusted for certain one-time non-recurring items and exclusions.