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Global-Tech Advanced Innovations Reports First Quarter Results for Fiscal 2014

  Global-Tech Advanced Innovations Reports First Quarter Results for Fiscal
  2014

Business Wire

HONG KONG -- September 27, 2013

Global-Tech Advanced Innovations Inc. (NASDAQ: GAI) today announced its net
sales and earnings for the quarter ended June 30, 2013 (the Company’s first
quarter of fiscal 2014).

Net sales for the quarter ended June 30, 2013 were $14.8 million, compared to
net sales of $20.5 million for the corresponding quarter in fiscal 2013. Net
loss for the first quarter of fiscal 2014 was $1.5 million, or $0.51 per
share, compared to a net income of $0.05 million, or $0.02 per share, for the
first quarter of fiscal 2013.

John C.K. Sham, the Company's President and Chief Executive Officer, said:
“The Company’s first quarter of fiscal 2014 saw a decrease in net sales of
electronic components of approximately $5.2 million when compared to the
corresponding quarter in fiscal 2013 due primarily to declines in customer
production levels. Despite lower sales, we are encouraged by the recent
production and shipment of our new 8.0 and 5.0 megapixel CCMs utilizing our
newly installed chip-on-board (COB) production lines, which we believe to be
crucial to returning the Company to profitability.”

Mr. Sham continued, “Rising labor costs, high turnover and decreased
productivity continue to have significant adverse effects on our operating
results. As these issues are likely to persist, we expect to make significant
changes in the operation of our businesses in an effort to offset these
factors. Additionally, as previously disclosed, a weakening Chinese economy
continues to adversely affect our EMS business segment which relies
exclusively on the Chinese domestic market. Accordingly, we are considering
strategic alternatives, including the potential leasing of our SMT equipment
and the facility that houses and operates such equipmentin an effort to
generate additional income and to improve our financial performance.”

Mr. Sham concluded, “We anticipate that our electronic components business
will return to at least prior year performance levels in the second half of
fiscal 2014, provided that sales of our newer 8.0 and 5.0 CCMs continue to
grow as anticipated. Until such time as this occurs or another business
opportunity presents itself, we will continue to rent the excess space in our
manufacturing facility to supplement our income.”

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 thousands of United States dollars except per share
data)
                                                 
                                                   Three Months Ended June 30,
                                                   2013           2012
                                                   (unaudited)    (unaudited)

Net sales                                          $  14,799      $ 20,492  
Cost of goods sold                                   (13,902  )    (17,450 )
Gross profit                                         897          3,042   
Selling, general and administrative expenses         (3,483   )    (3,452  )
Operating loss                                       (2,586   )    (410    )
Interest income, net                                 132          135     
Other income, net                                    852          298     
Income (Loss) from continuing operations before       (1,602   )     23
income taxes
Income taxes                                         36           -       
Net income (loss)                                     (1,566   )     23
Net income attributable to non-controlling           26           26      
interests
Net income (loss) attributable to shareholders     $  (1,540   )   $ 49      
of Global-Tech Advanced Innovations Inc.
                                                                   
Basic and diluted earnings (loss) per common       $  (0.51    )   $ 0.02    
share
                                                                   
Basic and diluted weighted average number of         3,040        3,040   
shares of common shares


GLOBAL-TECH ADVANCED INNOVATIONS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Amounts expressed in thousands of United States dollars)
                                               
                                                June 30, 2013  March 31, 2013
                                                (unaudited)     (audited)
ASSETS
Current assets:
Cash and cash equivalents                       $  20,583       $  32,385
Time deposits                                      14,610          -
Restricted cash                                    7,365           14,592
Available-for-sale investments                     17              17
Accounts and bills receivable                      16,546          19,714
Inventories                                        8,149           5,392
Prepaid expenses                                   219             181
Deposits and other assets                          3,449           5,044
Amount due from a related party                   13            19       
Total current assets                               70,951          77,344
Interests in jointly-controlled entities           -               -
Property, plant and equipment, net                 30,499          26,529
Land use rights, net                               3,024           3,027
Deposits paid for purchase of property, plant      205             280
and equipment
Available for sales investments                   1,046         1,045    
Total assets                                    $  105,725     $  108,225  
                                                                
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term bank loans                              6,411           4,826
Accounts payable                                   7,365           7,135
Customer deposits                                  1,447           1,331
Accrued salaries, allowances and other             4,065           4,368
employee benefits
Other accrued liabilities                          6,852           9,644
Income tax payable                                4,459         4,659    
Total current liabilities                          30,599         31,963
Deferred tax liabilities                          5             5        
Total liabilities                                 30,604        31,968   
Shareholders' equity:                                        
Common stock, par value $0.04 per share;
12,500,000 shares authorized; 3,230,814            129             129
shares issued as of June 30 and March 31,
2013
Additional paid-in capital                         85,062          85,053
Statutory reserves                                 1,238           1,238
Accumulated deficit                                (17,473  )      (15,933  )
Accumulated other comprehensive income             11,131          10,710
Less: Treasury stock, at cost, 189,587 shares     (4,663   )     (4,663   )
as of June 30 and March 31, 2013
Total Global-Tech Advanced Innovations Inc.        75,424          76,534
shareholders’ equity
Non-controlling interests                         (303     )     (277     )
Total equity                                      75,121        76,257   
Total liabilities and shareholders’ equity      $  105,725     $  108,225  

Contact:

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