Sino-Global Announces Fiscal 2011 Financial Results

BEIJING, Sept. 26, 2011 /PRNewswire-Asia/ -- Sino-Global Shipping America, Ltd. (Nasdaq: SINO), a leading, non-state-owned provider of shipping agency services operating primarily in China, today announced its selected financial results for fiscal year ended June 30, 2011.

Highlights for the Fiscal Year Ended June 30, 2011

• Revenues increased 22.7% to US$32.9 million, from US$26.8 million in the fiscal year ended June 30, 2010.
• Gross margin decreased to 10.1% in the current fiscal year compared to 11.8% in the prior fiscal year.
• General and administrative expenses as a percentage of total revenues decreased to 13.8% from 15.3% in fiscal 2010.
• Net loss was US$1.25 million compared to net loss of US$1.30 million in fiscal 2010.
• Basic and diluted losses per share were US$0.30 and US$0.18 for fiscal 2011 and fiscal 2010, respectively. Earnings and losses per share are adjusted for the non-controlling interest.

Sequential revenue growth throughout the first three quarters of fiscal 2011 was strong with revenues increasing 31.3% in the first quarter, 34.1% in the second quarter and 50.6% in the third quarter. In the final quarter of fiscal 2011 revenue declined 16.8% compared to the year earlier period due primarily to significantly lower iron ore shipments due to tightened Chinese government financing policies in response to the U.S. debt crisis and higher inflation rates in China.

Mr. Cao Lei, Sino Global's Chief Executive Officer, stated, "Sino-Global will continue to focus on revenue growth as a key to future growth and development and has looked to expand its current business activities at the loading ports in Australia, Canada, South Africa and other countries. In particular, as our recent announcement noted, we have added Baosteel, one of the largest steel manufacturers in China, to our customer list and now provide loading agency services for its vessels which carry iron ore and coal from Canada, South Africa and Australia to China."

Mr. Cao added, "We believe that our focus on maintaining our current clients, expanding our client base and new revenue opportunities in new markets in China and overseas will result in relatively high revenue growth in fiscal 2012, as we expect that an increase in the number of ports we serve in China and overseas will lead to an increase in the number of ships and customers that use our services."

Mr. Cao noted, "Our main challenge remains the devaluation of the U.S. dollar against the Chinese RMB. During the 2011 fiscal year, the RMB increased in value about 4.7% against the U.S. dollar, and we expect this trend to continue in fiscal 2012. We have offset some of the negative impact by negotiating a 5% increase in agency service fees with our largest customer, Beijing Shourong Forwarding Limited, and by recording both costs and revenues from our Australian operations in Australian dollars. Where possible we will strive to generate more agency service revenues from our overseas operations that are contracted in the local currencies."

Selected Financial Results for Fiscal 2011

Revenues

Total revenues were US$32.94 million, an increase of 22.7% from US$26.84 million in 2010. The number of ships that Sino-Global served increased by 17.6% from 358 in fiscal 2010 to 421 in fiscal 2011.

Cost of Revenues

Cost of revenues was US$29.6 million, an increase of 25.2% from US$23.7 million in fiscal 2010.

Costs of revenues increased faster than revenues, resulting in the decrease of gross margins from 11.8% down to 10.1% for the current fiscal year. The 1.75% decrease in gross margins was largely due to the devaluation of the U.S. dollar against the Chinese currency. Inflation in China and higher port charges also contributed to the cost increases. As a result, expenses payable in RMB absorbed a greater percentage of revenues in U.S. dollars.

Operating Expenses

General and administrative expenses were US$4.54 million, an increase of 10.7% from US$4.100 million in the prior fiscal year. Although the general and administrative expenses grew in line with our expanding marketing and operations in China and internationally, budget control efforts to reduce general and administrative expenses will remain a priority.

Selling expenses were US$342 thousand, an increase of 25.2% from US$273 thousand in the year-ago period. These expenses grew in line with our revenue growth.

Operating Loss

Operating loss was US$1.49 million compared to an operating loss of US$1.34 million in the year-ago period. The operating loss in fiscal 2011 was primarily due to the increase in costs of revenues and in general and administrative expenses.

Financial income was US$199 thousand, compared to financial income of US$151 thousand in the prior fiscal year. 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 benefits were US$77.4 thousand, compared to income tax expenses of US$86.6 thousand in the year-ago period.

Net loss was US$1.25 million, compared to net loss of US$1.30 million the year-ago period. After deduction of non-controlling interest in loss, net loss attributable to Sino-Global Shipping America Ltd. was US$863 thousand, compared to net loss of US$536 thousand in the year-ago period.

Basic and diluted loss per share, which is based on net loss attributable to Sino-Global Shipping America Ltd., was US$0.30, compared to basic and diluted loss per share of US$0.18 in the year-ago period.

Other Selected Data

As of June 30, 2011, the Company had US$4.9 million in cash and cash equivalents, compared to US$5.9 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 More Information

For a more detailed review of Sino-Global's financial results for fiscal year ended June 30, 2011, please refer to the company's annual report on Form 10K filing or Sino-Global's web site: www.sino-global.com.

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SOURCE Sino-Global Shipping America, Ltd.