Plastec Technologies Reports Unaudited 2013 First Quarter Financial Results

Plastec Technologies Reports Unaudited 2013 First Quarter Financial Results

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, today reported unaudited financial results for the three months ended March 31, 2013.

Financial and Operating Highlights for the Three Months Ended March 31, 2013


(all comparisons to same period of prior year)

  • Sales of $37.8 million, up 13.3% due to new customers and new product launches from existing clients
  • Gross margin of 20.7%, compared to 9.4%, resulting primarily from lower costs of revenue during the period
  • EBITDA of $7.1 million, compared to $5.6 million
  • Net income of $1.6 million, or $0.12 per diluted share based on 13.8 million diluted shares outstanding, compared to $0.4 million, or $0.03 per diluted share based on 15.0 million diluted shares outstanding
  • $3.9 million in cash generated from operations for the three months ended March 31, 2013
  • During the period, the Company repurchased 600,000 of its ordinary shares
  • $40.6 million in working capital and no long-term debt

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)

3 months period ended
March 31, 2013

 

3 months period ended
March 31, 2012

 

Percentage
Change

 
Sales$37.8$33.413.3%
Cost of Revenues$30.0$30.2(0.8%)
Gross Profit$7.8$3.2148.6%
Gross Profit Ratio20.7%9.4%
 
Income from Operations$2.9$0.6366.2%
Operating Margin7.8%1.9%
 
Net Income$1.6$0.4344.1%
Net Margin
 
Diluted EPS$0.12$0.03350.0%
Adjusted EBITDA*7.15.626.7%
 
* Reconciliation table at end of release
 
Balance Sheet Highlights

3/31/2013

12/31/2012

Percentage
Change

Cash and Cash Equivalents$36.2$39.7(8.9%)
Total Current Assets$82.4$89.8(8.2%)
Total Assets$141.8$151.2(6.2%)
Working Capital$40.6$39.91.9%
Total Long-term Debt000.0%
Total Liabilities$43.3$51.4(15.8%)
Shareholders' Equity$98.5$99.8(1.3%)
Total Liabilities and Shareholders' Equity$141.8$151.2(6.2%)

Management Comments

Mr. Kin Sun Sze-To, Chairman of Plastec, stated, "We are pleased to report solid financial and operating results for the quarter, largely driven by new product launchings from existing clients and the addition of new customers. Our results compared favorably to the prior year period in 2012, when the whole industry was subjected to difficult and unusual circumstances brought about by the Japanese earthquake and tsunami and flooding in Thailand. We continue to strive toward improving our operating performance, which includes maintaining a low cost structure while achieving higher margins through the completion of precision molding services and new product offerings from our customers."

Financial Review

  • Total sales for the three months ended March 31, 2013 increased 13.3% to $37.8 million from $33.4 million in the prior-year period. This was largely due to an increase in sales orders from existing customers for new products launchings, as well as Plastec's receipt of orders from new customers.
  • Gross profit margin for the three months ended March 31, 2013 was 20.7%, compared to 9.4% in the prior-year period. The increase in margin for the period was largely due to a reduction in costs of revenues resulting from the Company's efforts to further streamline its manufacturing process and to improve control of direct wages and factory overheads.
  • Income from operations was $2.9 million, or 7.8% of revenues, during the three months ended March 31, 2013, compared to $0.6 million, or 1.9%, in the prior-year period.
  • EBITDA for the three months ended March 31, 2013 was $7.1 million, compared to $5.6 million in the prior-year period.
  • Net income for the three months ended March 31, 2013 was $1.6 million, or $0.12 per share based on approximately 13.8 million weighted average diluted shares outstanding, compared to $0.4 million, or $0.03 per share based on approximately 15.0 million weighted average diluted shares in the prior-year period.

Share Repurchase Update

In December 2012, the Company approved a twelve-month extension of its previously announced share repurchase plan through December 9, 2013, 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, with all other terms of the repurchase plan remaining unchanged. To date, the Company repurchased 758,775 shares and 80,000 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 5,400 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 3-month
period ended March 31,

2013 2012
HK$ HK$
 
 
Revenues294,686260,133
Cost of revenues(233,772) (235,632)
Gross profit60,91424,501
 
Operating expenses, net
Selling, general and administrative expenses(37,944)(20,706)
Other income86587
Gain/(loss) on disposal of property, plant and equipment

(67)

 

549

Total operating expenses, net(37,925) (19,570)
 
Income from operations22,9894,931
 
Interest income5145
Interest expense(388) (660)
Income before income tax expense22,6524,316
 
Income tax expense(10,474) (1,574)
Net income12,1782,742
 
Other comprehensive income
Foreign currency translation adjustment1,318 119

Comprehensive income attributable to

Plastec Technologies, Ltd.

13,496

 

2,861

 
Net income per share:
 
Weighted average number of ordinary shares13,785,561 15,028,884
 
Weighted average number of diluted

ordinary shares

13,785,561

 

15,028,884

 
Basic income per share

attributable to Plastec Technologies, Ltd.

HK$0.9

 

HK$0.2

 
Diluted income per share

attributable to Plastec Technologies, Ltd.

HK$0.9

 

HK$0.2

PLASTEC TECHNOLOGIES, LTD.

CONSOLIDATED BALANCE SHEETS

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

   

(Unaudited)

(Audited)

 

March 31,
2013

 

December 31,
2012

HK$HK$

ASSETS

 
Current assets
Cash and cash equivalents282,347309,862

Trade receivables, net of allowances for doubtful accounts of HK$nil,
and HK$nil as of December 31, 2012 and March 31, 2013 respectively

235,776

257,299

Inventories81,14497,467
Deposits, prepayment and other receivables 43,558 35,471
Total current assets642,825700,099
 
Property, plant and equipment, net427,037440,383
Prepaid lease payments, net23,33123,719
Other assets12,19214,503
Intangible assets 438 438
Total assets 1,105,823 1,179,142
 

LIABILITIES AND SHAREHOLDERS' EQUITY

 
Current liabilities
Bank borrowings77,30596,892
Trade payables124,083151,436
Other payables and accruals88,927115,715
Tax payable 35,700 25,225
Total current liabilities326,015389,268
 
Deferred tax liabilities 11,629 11,629
Total liabilities 337,644 400,897
 
Commitments and contingencies--
 
Shareholders' equity

Ordinary shares (US$0.001 par value; 100,000,000 authorized
14,292,228 and 13,692,228 shares issued and outstanding as of
December 31, 2012 and March 31, 2013 respectively)

107

112

Additional paid-in capital61,77585,332
Accumulated other comprehensive income15,84214,524
Retained earnings 690,455 678,277
Total shareholders' equity 768,179 778,245
    
Total liabilities and shareholders' equity 1,105,823 1,179,142

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 3-month

period ended March 31,

 2013 2012
 HK$HK$
Operating activities
Net income12,1782,742

Adjustments to reconcile net income to net cash provided by
operating activities:

Depreciation and amortization32,21739,764
Loss/(gain) on disposal of property, plant and equipment67(549)
Changes in operating assets and liabilities:
Trade receivables21,523(11,218)
Inventories16,323(486)
Deposits, prepayment and other receivables(8,087)(6,066)
Trade payables(27,353)(11,907)
Other payables and accruals(26,788)(6,477)
Tax payables 10,474 1,901
Net cash provided by operating activities 30,554 7,704
 
Investing activities
Purchase of property, plant and equipment(11,954)(30,325)
Proceeds from disposal of property, plant and equipment3501,147
Deposits for purchase of property, plant and equipment (116) (1,459)
Net cash used in investing activities (11,720) (30,637)
 
Financing activities
Repurchases of shares(28,080)(181)
Net repayment of bank borrowings(19,587)(20,427)
Repayment of capital lease obligations - (1,112)
Net cash used in financing activities (47,667) (21,720)
 
 
 
Net decrease in cash and cash equivalents(28,833)(44,653)
Effect of exchange rate changes on cash and cash equivalents1,318110
Cash and cash equivalents, beginning of period 309,862 187,072
Cash and cash equivalents, end of period 282,347 142,529
 
Supplementary disclosures of cash flow information:
Interest paid, net 337 615
Income taxes paid/(refunded) - (327)

PLASTEC TECHNOLOGIES, LTD.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Unaudited)

(Hong Kong dollars in thousands)

  
3 Months Ended
 March 31,
2013 2012
 HK$ HK$
 
Net Income (note)12,159 1,606
PlusInterest expenses388660
MinusInterest incomes(51)(45)
PlusIncome tax expenses10,474 1,574
Income from operations22,9703,795
 
PlusDepreciation and Amortization Read Full Story

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