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Global-Tech Advanced Innovations Announces Fiscal 2013 Results



  Global-Tech Advanced Innovations Announces Fiscal 2013 Results

Business Wire

HONG KONG -- July 23, 2013

Global-Tech Advanced Innovations Inc. (NASDAQ: GAI) today announced its
financial results for the fiscal year ended March 31, 2013.

Net sales for fiscal 2013 were $81.1 million, an increase of approximately
16.4% when compared to net sales of $69.7 million in fiscal 2012. Net loss for
fiscal 2013 was $2.0 million, or $0.65 per share, compared to a net income of
$1.4 million, or $0.46 per share, in fiscal 2012.

Net sales for the fourth quarter of fiscal 2013 were $13.9 million, compared
to $15.5 million in the corresponding period in fiscal 2012. Net loss for the
fourth quarter of fiscal 2013 was $2.3 million, or $0.75 per share, compared
to a net loss of $1.5 million, or $0.51 per share, for the corresponding
quarter in fiscal 2012.

Despite incurring losses in fiscal 2013, the Company’s cash flow remained
positive as our net cash position increased approximately $1.9 million to
$42.2 million, primarily due to a significant reduction in accounts
receivables, partially offset by capital expenditures. Net cash (a non-GAAP
measure) is defined as cash and cash equivalents plus restricted cash less
short-term debt (a GAAP reconciliation has been provided below). In providing
our net cash position, we believe our shareholders, as well as potential
investors, gain a better understanding of the Company’s potential for future
growth and are better able to assess the Company’s financial strength and
available resources.

SG&A expenses in fiscal 2013 did not increase materially from fiscal 2012 when
discontinued operations are included and most of the increase was due to
exchange rate appreciation of the Renminbi against the U.S. dollar.

John C.K. Sham, the Company's President and Chief Executive Officer, said:
“The Company’s fourth quarter continues to be our weakest quarter, due at
least in part to business disruptions relating to the Chinese New Year. Rising
labor costs coupled with labor shortages in southern China negatively impacted
our operating results. The developing slowdown in the Chinese economy also
adversely impacted our business, most significantly in our EMS segment.”

Mr. Sham continued, “We are striving to address these and other cost issues,
including certain manufacturing costs previously absorbed by our home
appliance business prior to its discontinuation in January 2012. As part of
these efforts, we have started to lease some of the unused space in our
manufacturing facility that was previously occupied by our home appliance
business. However, we do not expect our efforts to adjust our cost structure
will have a material impact on our operating results until the second or third
quarter of fiscal 2014, at which time we believe we will return to
profitability. Until such time we expect our net cash position to continue to
remain strong.”

Mr. Sham concluded, “As previously disclosed, the expansion of our CCM
production capacity through the installation of three chip-on-board (COB)
production lines and a Class 10 clean room was recently completed. We are
pleased to report that our CCM business has started receiving orders that
require the use of our new COB production lines. Since COB production lines
are capable of producing higher-pixel camera modules and other
precision-related devices, we believe that our CCM business will continue to
grow through the addition of new customers and the sale of higher profit
margin products. As such, we are cautiously optimistic about the growth
opportunities of our CCM business and expect our CCM sales to increase and
profitability in this business segment to gradually improve in the coming
months.”

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.

Except for historical information, certain statements contained herein are
forward-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 ADVANCED INNOVATIONS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
 
(Amounts expressed in United States dollars, except per share data)
 
                          Year Ended
                         
                          March 31,
                          2013                  2012                  2011
                          (audited)             (audited)             (audited)
                                                                       
Net sales                 $ 81,083,384          $ 69,652,705          $ 57,468,866
Cost of goods               (70,817,320 )         (59,008,973 )         (50,403,138 )
sold
Gross profit                10,266,064            10,643,732            7,065,728
Selling,
general and                 (16,254,968 )         (10,612,458 )         (11,317,767 )
administrative
expenses
Other operating             -                     28,589                1,137,580    
income , net
Operating                   (5,988,904  )         59,863                (3,114,459  )
profit (loss)
Interest                    1,504,166             95,477                536,187
income, net
Other income                845,806               1,116,279             370,274      
(expenses), net
Income (Loss)
from continuing
operations                  (3,638,932  )         1,271,619             (2,207,998  )
before income
taxes
Income tax
benefit                     841,900               (1,228,625  )         (204,122    )
(expense)
Income (Loss)
from continuing             (2,797,032  )         42,994                (2,412,120  )
operations
Income (Loss)
from
discontinuing               725,773               1,374,342             (1,775,879  )
operations, net
of tax
Net income                  (2,071,259  )         1,417,336             (4,187,999  )
(loss)
Net income
(loss)
attributable to             107,958               (6,659      )         175,028      
non-controlling
interests
Net income
(loss)
attributable to
shareholders of           $ (1,963,301  )       $ 1,410,677           $ (4,012,971  )
Global-Tech

  Advanced
Innovations Inc
                                                                       
Basic and
diluted
earnings (loss)
from continuing           $ (0.88       )       $ 0.01                $ (0.74       )
operations per
share of common
stock
                                                                       
Basic and
diluted
earnings (loss)           $ (0.65       )       $ 0.46                $ (1.32       )
per share of
common stock
                                                                       
Basic and
diluted
weighted
average number              3,040,310             3,039,727             3,039,454    
of shares

  of common
stock
                                                                       

 
GLOBAL-TECH ADVANCED INNOVATIONS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Amounts expressed of United States dollars)
 
                                         March 31,             March 31,
                                                              
                                         2013                  2012
                                         (audited)             (audited)
ASSETS
Current assets:
Cash and cash equivalents                $ 32,385,376          $ 39,792,733
Restricted cash                            14,592,289            4,546,062
Available-for-sale investments             17,153                2,006,066
Accounts and bills receivable              19,713,608            30,273,062
Inventories                                5,392,332             5,374,192
Prepaid expenses                           181,224               149,558
Deposits and other assets                  5,044,456             769,206
Amount due from a related                  18,841                11,798       
party
Total current assets                       77,345,279            82,922,677
Interests in                               -                     -
jointly-controlled entities
Property, plant and equipment,             26,528,681            21,933,787
net
Land use rights, net                       3,026,537             3,083,128
Deposits paid for purchase of              280,146               66,617
property, plant and equipment
Available-for-sale investments             1,045,200             1,033,800    
Total assets                             $ 108,225,843         $ 109,040,009  
                                                                
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities:
Short-term bank loans                      4,826,241             4,000,000
Accounts payable                           7,134,526             8,163,510
Customer deposits                          1,331,100             860,779
Accrued salaries, allowances               4,367,642             3,102,335
and other employee benefits
Other accrued liabilities                  9,643,638             6,637,851
Income tax payable                         4,659,313             6,157,885    
Total current liabilities                  31,962,460            28,922,360
Deferred tax liabilities                   5,180                 27,017       
Total liabilities                          31,967,640            28,949,377   
                                                                              
Shareholders' equity:                                           
Common stock, par value $0.04
per share; 12,500,000 shares
authorized;
                                           129,233               129,173
3,230,814 and 3,229,314 shares
issued as of March 31, 2013
and 2012
Additional paid-in capital                 85,053,402            84,786,226
Statutory reserves                         1,238,361             -
Accumulated deficit                        (15,932,941 )         (9,690,526  )
Accumulated other                          10,709,740            9,697,445
comprehensive income
Less: Treasury stock, at cost,
189,587 shares as of March 31,             (4,663,321  )         (4,663,321  )
2013 and 2012
Total Global-Tech Advanced
Innovations Inc. shareholders’             76,534,474            80,258,997
equity
Non-controlling interests                  (276,271    )         (168,365    )
Total shareholders’ equity                 76,258,203            80,090,632   
Total liabilities and                    $ 108,225,843         $ 109,040,009  
shareholders' equity
 

 
GLOBAL-TECH ADVANCED INNOVATIONS INC. AND SUBSIDIARIES
RECONCILIATION OF NET CASH POSITION (NON-GAAP) TO GAAP
(Amounts expressed of United States dollars)
 
Reconciliation of Net Cash Position (Non-GAAP) to GAAP
 
Net Cash Position – Net cash position, a non-GAAP measure, is defined as cash
and cash equivalents plus restricted cash less short-term debt.
 

                                    March 31,             March 31,
                                                         
                                    2013                  2012
                                    (unadited)            (unaudited)
                                                           
Net cash position                   $ 42,151,424          $ 40,338,795
Add:
Short-term bank loans                 4,826,241             4,000,000
Less:
Restricted cash                       (14,592,289 )         (4,546,062 )
Cash and cash equivalents             32,385,376            39,792,733  
 

Contact:

Global-Tech Advanced Innovations Inc.
Cecilia Au-Yeung
Hong Kong (852) 2814-0601
investorrelations@global-webpage.com
http://global-webpage.newshq.businesswire.com
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