Sino-Global Announces First Fiscal Quarter 2011 Financial Results
BEIJING, Nov. 12, 2010 /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 fiscal quarter ended September 30, 2010.
Highlights for the First Quarter of 2011
- Revenues increased 31.3% to US$8.2 million, from US$6.2 million in the first quarter of 2010.
- Gross margin decreased to 9.8% compared to 12.8% in the first quarter of 2010.
- General and administrative expenses as a percentage of total revenues decreased to 12.5% from 13.7% in the first quarter of 2010.
- Net loss was US$202 thousand compared to net loss of US$15 thousand in the first quarter of 2010.
- Basic and diluted losses per share were US$0.05, compared to basic and diluted earnings per share of US$0.03 in the first quarter of 2010.
"We continued our top-line growth for this quarter and expect the trend will continue through the 2011 fiscal year," said Mr. Cao Lei, Sino-Global's Chief Executive Officer. "We expect that we will continue to earn a substantial majority of our revenues from our shipping agency services. As a result, we plan to continue to focus most of our resources on expanding our business to cover more ports in the PRC. In addition, we will allocate our resources in marketing our brand to customers, including ship owners and charters, who transport goods from overseas to China."
"The second round re-valuation of RMB against U.S. dollars started in June 2010, significantly hurt our gross margin. Because we receive most of our revenues in U.S. dollars and pay most of our expenses in Chinese Renminbi ("RMB"), we have faced increased costs of revenues due to the devaluation of U.S. dollars against RMB over the last several years. From June 17, 2010, Chinese RMB started its second round of re-valuation, and we anticipate that the U.S. dollar will devalue about 2% to 5% against the RMB in 2011," said Mr. Zhang Mingwei, Sino-Global's Chief Financial Officer. "While continuing our effort in sales growth, we have to further our budget controls over general and administrative expenses."
Selected Financial Results for the First Quarter of 2011
Total revenues were US$8.2 million in the first quarter of 2011, an increase of 31.3% from US$6.2 million in the 2010 period. The number of ships that Sino-Global served increased 10.8% to 103 in the first quarter of 2011, from 93 in the year-ago period.
Cost of Revenues
Cost of revenues was US$7.4 million in the first quarter of 2011, an increase of 35.8% from US$5.4 million in the year-ago period.
Cost of revenues as a percentage of total revenues for the first quarter of 2011 increased to 90.2% from 87.2% in the year-ago period. Costs of revenues increased faster than revenues, resulting in the decrease of gross margins from 12.8% down to 9.8% for the comparative three months ended September 30, 2009 and 2010, respectively. Because iron ore prices increased, importers used larger vessels to save freight costs. This resulted in increased fee charges at Chinese local ports. Additionally, the foreign exchange rate of Chinese currency against the U.S. dollar increased during the period. The average foreign exchange rate was RMB6.7692 to $1.00 for the first quarter of fiscal 2011 compared to RMB6.8309 to $1.00 for the first quarter of fiscal 2010. As a result, expenses payable in RMB occupied a greater percentage of revenues in U.S. dollars.
General and administrative expenses were US$1.0 million in the first quarter of 2011, an increase of 19.7% from US$858 thousand in the year-ago period. General and administrative expenses as a percentage of total revenues decreased to 12.5% in the first quarter 2011 from 13.7% in the year-ago period.
This increase includes (1) an increase of $12 thousand in salaries and human resource expenses, (2) increased travel and car related expenses of $59 thousand, (3) an increase of $55 thousand in office supplies due to operating volume increase and (4) increased entertainment expenses of $35 thousand for business promotion.
Selling expenses were US$54 thousand in the first quarter of 2011, an increase of 16.4% from US$47 thousand in the year-ago period.
Operating loss was US$248 thousand in the first quarter of 2011, an increase of 394.1% from US$50 thousand in the year-ago period. The operating loss for the first quarter of fiscal 2011 was primarily due to the increase in costs of revenues and in general and administrative expenses.
Financial income was US$86 thousand in the first quarter of 2011, compared to financial income of US$169 thousand in the year-ago period. The net financial income comes largely from interest income from money deposits in banks and by the foreign exchange losses recognized in the financial statement consolidation.
Income tax expenses were US$28 thousand in the first quarter of 2011, a decrease of 83.8% from US$174 thousand in the year-ago period.
Net loss was US$202 thousand in the first quarter of 2011, compared to net loss of US$15 thousand in the year-ago period. Net loss attributable to Sino-Global Shipping America Ltd. was US$143 thousand in the first quarter of 2011, compared to net profit of US$96 thousand in the year-ago period.
Basic and diluted loss per share in the first quarter of 2011 was US$0.05, compared to basic and diluted earnings per share of US$0.03 in the year-ago period.
Other Selected Data
As of September 30, 2010, the Company had US$6.2 million in cash and cash equivalents, compared to US$6.6 million in the year-ago period.
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 most of China's main 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 the date hereof. Sino-Global undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
For investor and media inquiries, please contact:
Ms. Apple Liang
SOURCE Sino-Global Shipping America, Ltd.
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