Plastec Technologies Reports Unaudited Financial Results for the Two- and Nine-Month Transition Peri

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Plastec Technologies Reports Unaudited Financial Results for the Two- and Nine-Month Transition Periods Ended September 30, 2012

Financial Highlights for the Two Months Ended September 30, 2012

  • Sales of $31.3 million; an increase of 1.3%
  • Gross margin of 17.7% compared to 11.0%
  • EBITDA of $7.0 million;
  • Net income of $3.2 million, or $0.22 per diluted share

HONG KONG--(BUSINESS WIRE)-- Plastec Technologies, Ltd. - (OTCBB: PLTYF (ordinary shares), PLTWF (warrants), PLTEF (units)) ("Plastec" or the "Company"), an integrated plastic manufacturing services provider that operates in the People's Republic of China, announced today unaudited financial results for the two months and year-to-date ended September 30, 2012.

As previously disclosed in the Company's Form 6-K filing with the SEC on September 11, 2012, Plastec's Board of Directors approved a change in the Company's fiscal year to a calendar period ending December 31st from a fiscal year ending on April 30th. The change in fiscal year end was made so that the Company's fiscal year end would coincide with all the Company's operating subsidiaries in the People's Republic of China. The Company will file a transition report on Form 20-F within four months after December 31, 2012 to cover the transition period from May 1, 2012 to December 31, 2012 in order to reflect this change.

See attached tables at the end of this release in Hong Kong Dollars (HKD). All other amounts in this press release are presented in U.S. dollars (USD) with a conversion rate of US$1.0: HK$7.8 (see table below for reference).

($ in millions, except per share data)

2 months ended

9/30/2012

 2 months ended

9/30/2011

 9 months ended

9/30/2012

 9 months ended

9/30/2011

Sales$31.3$30.9$126.0$132.5
Cost of Revenues$25.8$27.5$110.2$113.3
Gross Profit$5.5$3.4$15.8$19.2
Gross Profit Ratio17.7%11.0%12.5%14.5%

Income from Operations

$3.4$1.5$7.6$11.1

Net Income

$

3.2

$

1.1

$

6.6

$

8.0

Diluted EPS$0.22$0.07$0.46$0.60

Adjusted EBITDA*

$7.0$4.8$22.4$25.7

* Reconciliation table at end of release

Management Comments

Mr. Kin Sun Sze-To, Chairman of Plastec, stated, "We are pleased to report improved margins and profitable results during the period, despite relatively flat sales. We remain conservative in our short-term view of the market and have focused our attention on streamlining our costs and improving our operating performance. We achieved a better margin in these two months largely due to more value added services rendered in our products. Throughout the difficult conditions of the past 18 months, we have focused on continuing to remain profitable and cost-effectively growing our business. We increased our capacity through the expansion of our largest facility in Shenzhen, and have begun preparations to establish production lines in Thailand. We have carefully selected the locations of production facilities in order to facilitate timely delivery of our products to customers, and our expansion into Thailand is an extension of this philosophy."

Financial Review for the Two Months Ended September 30, 2012

  • The Company's total sales for the two months ended September 30, 2012 increased 1.3% to $31.3 million from $30.9 million in the prior-year period.
  • The Company's gross profit margin for the two months ended September 30, 2012 was 17.7%, compared to 11.0% in the prior-year period. The increase in margin for the period was largely the result of a more favorable product mix, which included higher margin secondary-process finishing services.
  • EBITDA for the two months ended September 30, 2012 was $7.0 million, compared to $4.8 million in the prior-year period.
  • Net income for the two months ended September 30, 2012 was $3.2 million, or $0.22 per share based on a weighted average number of diluted shares outstanding of approximately 14.3 million, compared to $1.1 million, or $0.07 per share based on approximately 16.7 million weighted average number of diluted shares in the prior-year period.

YTD Financial Review

  • The Company's total sales for the nine months ended September 30, 2012 were $126.0 million, compared to $132.5 million in the prior-year period. The decrease is largely due to lower volume in the first half of calendar 2012.
  • The Company's gross profit margin for the nine months ended September 30, 2012 was 12.5%, compared to 14.5% in the prior-year period.
  • EBITDA for the nine months ended September 30, 2012, was $22.4 million, compared to $25.7 million in the prior-year period.
  • Net income for the nine months ended September 30, 2012 was $6.6 million, or $0.46 per share based on a weighted average number of diluted shares outstanding of approximately 14.5 million, compared to $8.0 million, or $0.60 per share based on approximately 13.5 million weighted average number of diluted shares, in the prior-year period.

Balance Sheet Highlights

($ in millions)

 9/30/2012 4/30/2012 % Change
Cash and Cash Equivalents$28.5$25.611.3%
Total Current Assets89.781.010.7%
Total Assets157.7153.03.1%
Working Capital30.021.142.2%
Total Long-term Debt00N/A
Stockholders' Equity96.191.35.3%

Share Repurchase Update

In June 2012, the Company approved a six-month extension of its previously announced share repurchase plan, allowing Plastec to purchase up to $5 million of its ordinary shares in both open market and privately negotiated transactions at the discretion of the Company's management and as market conditions allow. The Company also expanded the scope of the repurchase plan to include Plastec's publicly-held warrants (under ticker "PLTWF"), with all other terms of the repurchase plan remaining unchanged. To date, the Company has repurchased 64,675 shares and 0 warrants under its repurchase plan.

About Plastec

Originally founded in 1993 by Chairman and CEO, Mr. Kin Sun Sze-To, Plastec is an integrated plastic manufacturing services provider that operates in the People's Republic of China through its wholly owned subsidiaries. With approximately 5,500 employees, Plastec provides precision plastic manufacturing services from mold design and fabrication, plastic injection manufacturing to secondary-process finishing, as well as parts assembly.

Forward Looking Statements

This press release contains "forward-looking statements." These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Actual results may differ from expectations, estimates and projections and, consequently, you should not rely on these forward looking statements as predictions of future events. Words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believes," "predicts," "potential," "continue," and similar expressions are intended to identify such forward-looking statements.

PLASTEC TECHNOLOGIES, LTD.
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED)
(Hong Kong dollars in thousands, except number of shares, per share data and unless otherwise stated)
     
For the 2 months endedFor the 9 months ended
September 30,September 30,
2012201120122011
HK$ HK$HK$HK$
 
Revenue244,121240,978982,7281,033,750
Cost of revenues(201,002)(214,354)(859,452)(883,694)
Gross profit43,11926,624123,276150,056
 
Operating expenses
Selling, general and administrative expenses(15,721)(14,873)(65,676)(64,487)
Other income484772,620529
Gain/(loss) on disposal of property, plant and equipment

(1,262)

 

 

55 (1,203)611 
Total operating expenses, net(16,499)(14,741)(64,259)(63,347)
 
Income from operations26,62011,88359,01786,709
 
Interest income4559145163
Interest expense(446)(544)(1,810)(2,327)
Income before income tax expense26,21911,39857,35284,545
 
Income tax expense(1,196)(2,611)(5,865)(21,877)
Net income25,0238,78751,48762,668
 
Other comprehensive income
Foreign currency translation adjustment(248)- (649)7,138 
Comprehensive income attributable to
Plastec Technologies, Ltd.24,775 8,787 50,838 69,806 
 
Weighted average number of ordinary shares14,292,22816,733,19614,498,32013,469,699
Weighted average number of diluted ordinary

shares

14,292,22816,733,19614,498,32013,469,699
 

Basic earnings per share attributable to Plastec Technologies, Ltd.

HK$1.8 HK$0.5HK$3.6HK$4.7

Diluted earnings per share attributable to Plastec Technologies, Ltd.

HK$1.8 HK$0.5HK$3.6HK$4.7

PLASTEC TECHNOLOGIES, LTD.

CONSOLIDATED BALANCE SHEETS

(Hong Kong dollars in thousands, except number of shares, per share data and unless otherwise stated)

 
  As at As at

September 30, 2012

April 30, 2012

HK$HK$
(Unaudited)(Audited)
ASSETS
Current assets
Cash and cash equivalents222,552199,818

Trade receivables, less allowance for doubtful amounts of HK$nil and HK$nil as of September 30 & April 30, 2012 respectively

333,755282,869
Inventories122,130128,387
Deposits, prepayment and other receivables21,33520,514
Total current assets699,772631,588
 
Property, plant and equipment495,736524,137
Prepaid lease payments24,10724,753
Other assets9,98712,813
Intangible assets438438
Total assets1,230,0401,193,729
 
LIABILITIES AND EQUITY
Current liabilities
Bank borrowings121,806156,866
Capital lease obligations25303
Trade payables133,593121,964
Other payables and accruals135,076115,109
Tax payable75,36972,936
Total current liabilities465,869467,178
 
Deferred tax liabilities14,50414,504
Total liabilities480,373481,682
 
Commitments and contingencies--
 
Shareholders' equity
Preferred shares (US$0.001 par value; 1,000,000 share authorized, none issued and outstanding)--

Ordinary shares (US$0.001 par value; 100,000,000 shares authorized, 14,292,228 and 14,352,903 shares issued and outstanding as of September 30, 2012 and April 30, 2012, respectively)

111112
Additional paid-in capital75,12877,967
Accumulated other comprehensive income14,86615,514
Retained earnings659,562618,454
Total Plastec Technologies, Ltd. Shareholders' equity749,667712,047
  
Total liabilities and shareholders' equity1,230,0401,193,729

PLASTEC TECHNOLOGIES, LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Hong Kong dollars in thousands, except number of shares, per share data and unless otherwise stated)

 

 

For the 9 months ended
September 30,
2012 2011
HK$HK$
 
Operating activities
Net income after taxation51,48762,668
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization118,375115,903
Net loss/(gain) on disposal of property, plant and equipment1,203(611)
Deferred tax charge-(652)
Change in operating assets and liabilities:
Trade receivables(76,547)1,084
Inventories13,28512,888
Deposits, prepayment and other receivables(8,785)1,064
Trade payables9,657(16,699)
Other payables and accruals20,12014,577
Tax payables6,192 22,530 
 
Net cash provided by operating activities134,987 212,752 
 
Investing activities
Purchase of property, plant and equipment(69,066)(123,646)
Proceeds from disposal of property, plant and equipment12,4912,615
Deposits for purchase of property, plant and equipment(9,988)(11,786 Read Full Story

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