Sino-Global Announces Results for Third Fiscal Quarter 2009
May 18 2009 - 5:00AM
PR Newswire (US)
BEIJING, May 18 /PRNewswire-Asia/ -- Sino-Global Shipping America,
Ltd. (NASDAQ:SINO) ("Sino-Global" or the "Company"), a leading,
non-state-owned provider of shipping agency services operating
primarily in China, today announced its selected unaudited
financial results for its third fiscal quarter of 2009 ended March
31, 2009. Highlights for the Third Quarter of 2009 -- Revenues were
US$3.3 million, an increase of 8.4% from US$3.0 million in the
third quarter of 2008. -- Gross margin was 24.2%, compared to 12.3%
in the third quarter of 2008. -- Operating margin was -7.5% in the
third quarter of 2009, compared to -9.3% in the third quarter of
2008. -- On April 27, 2009, Sino-Global announced that it had
established branch offices in the ports of Yantai and Yingkou,
enabling the Company to offer a full range of shipping agency
services in two additional ports that serve approximately 8.7
million people. -- On October 9, 2008, Sino-Global announced a
program authorizing the Company to repurchase up to 10% of its
outstanding common stock over a 12-month period. As of March 31,
2009, Sino-Global had repurchased 69,400 shares. These purchases
reflect the Company's confidence in its future growth prospects.
Mr. Cao Lei, Sino-Global's chief executive officer, said: "The
third fiscal quarter of 2009 was one of the most difficult quarters
we have experienced, but we nevertheless delivered positive
year-over-year growth on our top line and had noteworthy margin
improvement. We were successful in diversifying away from shippers
of commodities such as steel by picking up a major new client that
has made a significant contribution to our improving margins. Going
forward, we will continue to seek out opportunities to expand into
complementary areas of service and new geographies. Since our IPO
in May of last year, we have focused significant effort on the
marketing and promotion of our shipping agency services among
existing and potential clients alike. These efforts have resulted
in an increased recognition of the Sino-Global brand, and we expect
that these efforts, combined with our recently announced
cost-cutting measures, will enable us to break even next quarter in
a challenging world economy." Financial Results for the Third
Quarter of 2009 Revenues Revenues were US$3.3 million in the third
quarter of 2009, an increase of 8.4% from US$3.0 million in the
third quarter of 2008. As a result of the current global economic
downturn, fewer ships carried goods to and from China compared to
the same period in 2008, and the Company's revenue derived from
existing customers shipping iron ore declined year-over-year.
However, the decline was offset by business from a new customer
that exports automobiles from China to countries in North America,
Asia, Europe, the Middle East and Africa. Sino-Global expects that
it will continue to earn a substantial majority of its revenues
from shipping agency services. The Company has placed considerable
focus on the promotion of its shipping agency services business in
recent quarters and intends to expand its business scope to related
and complementary areas in order to meet growth targets. Costs of
Services and Gross Profit Costs of services were US$2.5 million in
the third quarter of 2009, a decrease of 6.3% from US$2.7 million
in the third quarter of 2008. Gross profit was US$0.8 million in
the third quarter of 2009, an increase of 112.6% from US$0.4
million in the third quarter of 2008. Gross margin was 24.2% in the
third quarter of 2009, compared to 12.3% in the third quarter of
2008. The year-over-year improvement in gross margin was mainly the
result of higher margin business from a new shipping agency
customer as well as contribution from the Company's owners' affairs
services. The improvement was partially offset by the depreciation
of the U.S. dollar against the Chinese yuan ("RMB") in the same
period, from RMB7.1597 to US$1.00 in the three months ended March
31, 2008 to RMB6.8363 to US$1.00 in the three months ended March
31, 2009, a 4.52% percent average year-over-year depreciation of
the U.S. dollar against the RMB. Because the Company receives
income in U.S. dollars but pays a majority of expenses in RMB, the
depreciation of the U.S. dollar against the RMB has a negative
effect on the Company. Operating Expenses General and
administrative expenses were US$0.9 million in the third quarter of
2009, an increase of 39.3% from US$0.6 million in the third quarter
of 2008. The increase in general and administrative expenses was
mainly due to salary expenses used to attract and retain
high-caliber personnel, expenses related to becoming a public
company, expenses related to business expansion and the
implementation of a new information management system, office
rental expenses and expenses for legal, accounting and other
professional services. Selling expenses were US$101 thousand in the
third quarter of 2009, an increase of 123.6% from US$45 thousand in
the third quarter of 2008, largely due to increased business
promotion and travel expenses as well as expenses related to the
Company's recently opened Hong Kong and Australia branches and
servicing ships in additional ports. Operating Profit Operating
loss was US$0.2 million in the third quarter of 2009, a 12.7%
decrease from US$0.3 million in the third quarter of 2008.
Operating margin was -7.5% in the third quarter of 2009, compared
to -9.3% in the third quarter of 2008. Financial expenses were US$9
thousand in the third quarter of 2009, compared to financial income
of US$80 thousand in the third quarter of 2008. The financial
expenses were largely the result of foreign currency exchange
losses, which outweighed income from bank deposits. Income tax
expense was US$1 thousand in the third quarter of 2009, a 92.6%
decrease from US$20 thousand in the third quarter of 2008. Net
Income Net loss was US$99 thousand in the third quarter of 2009, a
66.6% decrease from US$297 thousand in the third quarter of 2008.
Net margin was -3.0% in the third quarter of 2009, compared to
-9.8% in the third quarter of 2008. Basic and diluted losses per
share in the third quarter of 2009 were US$0.03, compared to
US$0.16 in the third quarter of 2008. Other Select Data As of March
31, 2009, the Company had US$7.3 million in cash and cash
equivalents, compared to US$9.6 million as of June 30, 2008. Net
cash used in operating activities and capital expenditures for the
third quarter of 2009 was US$1.9 million and US$0.2 million,
respectively. Share Buyback On October 9, 2008, Sino-Global's board
of directors approved a share buyback authorizing the Company to
repurchase up to 10% of the Company's outstanding common stock for
a period of 12 months. As of March 31, 2009, the Company had
repurchased 69,400 shares from the open market at an average price
of US$2.74, including trading expenses. Business Outlook Due to the
global economic slowdown: -- The amount of goods imported into
China has decreased significantly, resulting in fewer ships from
existing clients served. -- While the Company has focused
significant effort on the promotion of its shipping services
business to current and new clients and has achieved positive
revenue growth in the first three quarters of fiscal year 2009, the
effects of the financial crisis have overshadowed these positive
achievements. Subsequently, the Company is revising annual growth
expectation downward, which may result in net losses for full
fiscal year 2009. The Company additionally noted that as a result
of cost-cutting measures announced March 30, 2009, it expects to
break even in the fourth fiscal quarter of 2009, resulting in a
full-year net loss from continuing operations before
non-controlling interest of approximately US$2.0 million and a net
loss of approximately US$1.5 million. These views are current and
preliminary and are subject to change. About Sino-Global Shipping
America, Ltd. Registered in the United States in 2001 and operating
primarily in Mainland China, Sino-Global is a leading,
non-state-owned provider of high-quality shipping agency services.
With local branches in eight of China's 76 ports and contractual
arrangements in all those where it does not have branch offices,
Sino-Global is able to offer efficient, high-quality shipping
agency services to shipping companies entering Chinese ports. With
a subsidiary in Perth, Australia, where it has a contractual
relationship with a local shipping agency, Sino-Global provides
complete shipping agent services to companies involved in trades
between Chinese and Australian ports. Sino-Global also operates a
subsidiary in Hong Kong, China, to provide comprehensive shipping
agent services to vessels going to and from one of the world's
busiest ports. Sino-Global provides ship owners, operators and
charters with comprehensive yet customized shipping agency services
including intelligence, planning, real-time analysis and
on-the-ground implementation and logistics support. Sino-Global has
achieved both ISO9001 and UKAS certifications. Forward Looking
Statements No statement made in this press release should be
interpreted as an offer to purchase any security. Such an offer can
only be made in accordance with the Securities Act of 1933, as
amended, and applicable state securities laws. Any statements
contained in this release that relate to future plans, events or
performance are forward-looking statements that involve risks and
uncertainties as identified in Sino-Global's filings with the
Securities and Exchange Commission. Actual results, events or
performance may differ materially. Readers are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date hereof. A number of factors could cause
actual results to differ materially from those contained in any
forward-looking statement, including but not limited to the
following: Sino-Global's anticipated growth strategies;
Sino-Global's future business development, results of operations
and financial condition; expected changes in the Company's revenues
and certain cost or expense items; Sino-Global's ability to attract
customers and leverage its brand; Sino-Global's timely receipt of
payment from customers under new and existing contracts; trends and
competition in the shipping and shipping agency industries; the
Company's ability to hire, train and retain qualified managerial
and other employees; Sino-Global's efforts at controlling company
expenses; the Company's ability to develop and market new services
in a timely and cost-effective manner; the expected growth of the
Chinese economy and the shipping industry in particular;
fluctuations in currency exchange rates; applicable tax rates; the
continued viability of the partnership model of expansion; and
Sino-Global's ability to leverage our subsidiaries located outside
the U.S. for tax and revenue benefits. In addition Sino-Global
cannot guarantee that any expansion of the Company's current scope
of services will result in the anticipated, or any, benefits to the
Company. Sino-Global undertakes no obligation to publicly release
the results of any revisions to these forward-looking statements
that may be made to reflect events or circumstances occurring after
the date hereof or to reflect the occurrence of unanticipated
events. For investor and media inquiries, please contact: Ms. Apple
Liang Sino-Global, Beijing Tel: +86-10-6439-1888 Email: Ms. Flora
Tian Ogilvy Financial, Beijing Tel: +86-10-8520-6524 Email:
DATASOURCE: Sino-Global Shipping America, Ltd. CONTACT: Ms. Apple
Liang of Sino-Global, Beijing, +86-10-6439-1888, or ; or Ms. Flora
Tian of Ogilvy Financial, Beijing, +86-10-8520-6524, or , for SINO
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