JST Jinpan International Limited

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________

 

FORM 6-K

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16

Under the Securities Exchange Act of 1934

For the Month of March 2009

_______________________

 

Commission File No. 1-14742

 

JINPAN INTERNATIONAL LIMITED

(Translation of Registrant’s Name into English)

 

c/o Hainan Jinpan Special Transformer Works

Section D-2,

No. 100 Industry Avenue

Jinpan Development Area

Haikou, Hainan PRC

(Address of Principal Executive Office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:        x  Form 20-F         o  Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

Note : Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

Note : Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:          o Yes   o No

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-______________

 

Attached hereto as Exhibit 1 and incorporated by reference herein is the Registrant’s press release, dated March 30, 2009.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Dated: April 1, 2009

 

 

 

Jinpan International Reports Fourth Quarter and Full Year 2008 Financial Results

 

-- 4Q08 Revenue Increases 7% to $44.9 Million Compared to 4Q07 --

--Full Year Revenue Increases 28.7% to $154.0 Million –

-- Full Year Net Income Increases 20.5% to $19.8 Million –

 

Englewood Cliffs, N.J., March 30, 2009 – Jinpan International Ltd (Nasdaq: JST),a leading designer, manufacturer and distributor of cast resin transformers for voltage distribution equipment, today announced consolidated financial results for the fourth quarter and full year ended December 31, 2008.

 

Highlights for the 2008 Fourth Quarter

 

Total sales for the fourth quarter were $44.9 million, a 7% increase from $41.9 million over the same period last year. Growth in total sales primarily resulted from an increase in the sale of the Company’s wind energy products, which include the cast resin transformers and reactors for wind power applications.

 

In the fourth quarter, sales outside of China increased 137% to $7.1 million, or 15.8% of total sales, compared to $3.0 million, or 7% of total sales in the same period last year. Growth in international sales is mostly due to the increase in the Company’s sales of wind energy products.

 

Cast resin transformers (excluding those for wind power applications), switch gears and unit substations represented $38.8 million, or 86.6% of total sales in the fourth quarter, while wind energy products represented $6.0 million, or 13.4% of total sales in the fourth quarter.

 

Gross profit in the fourth quarter was $13.5 million, a 13.5% decrease from $15.7 million, in the same period last year. Fourth quarter gross margin decreased to 30.2% compared to 37.4% in the same period last year. The price of raw materials declined significantly in the fourth quarter which put downward pressure on the market price of transformers. Additionally, in the fourth quarter, the Company’s cost of sales continued to reflect the higher price of materials procured prior to the price decline. The combination of the downward pressure on the market price of transformers and cost of sales that reflects higher cost of raw materials procured at the end of third quarter primarily caused the decline in gross margin. The Company expects lower materials prices to be reflected in its cost of sales in the first quarter of 2009, which should have a positive effect on gross margin.

 

Selling, general and administrative expenses in the fourth quarter were $8.0 million, or 17.8% of total sales, versus $8.8 million, or 21% of total sales in the same period last year. SG&A decreased primarily due to strict cost controls implemented within key operating units.

 

Operating income increased to $5.5 million, or 12.4% of total sales, compared to $6.8 million, or 16.3% of total sales in the same period last year.

 

Net income for the fourth quarter was $6.2 million, or $0.75 per diluted share, versus $6.6 million, or $0.81 per diluted share, in the same period last year. Fourth quarter net income as a percentage of revenue was 13.8% as compared to 15.7% in the same period last year.

 

Fiscal 2008 Results

 

For the full year, total sales increased 28.7% to $154.0 million compared to $119.6 million in the prior year.

 

Gross profit for the full year increased to $48.9 million compared to $41.6 million in the prior year . Gross margin for the full year decreased 3.1% to 31.7% from 34.8% in the prior year.

 

Selling, general and administrative expenses for the full year were $26.2 million, or 17.0% of total sales, compared to $23.0 million, or 19.2% of sales in the prior year.

 

Operating profit for the full year increased 21.4% to $22.7 million compared to $18.7 million in the prior year. Full year operating margin decreased to 14.7% compared to 15.6% in the prior year.

 

Net income for the full year increased 20.5% to $19.8 million, or $2.42 per diluted share, compared to $16.4 million, or $2.03 per diluted share in the prior year.

 

Mr. Zhiyuan Li, Chief Executive Officer of Jinpan commented, “2008 was a solid year for Jinpan and we were pleased with our overall financial results. Our revenue growth in the fourth quarter moderated compared to prior quarters as the decline in raw material prices prompted some of our customers to pare back or delay product orders. We also implemented a more conservative customer credit policy due to the global financial crisis, which impacted the strength of our revenue growth. We experienced a sharp decline in raw materials prices in the fourth quarter, but do not expect margins to improve until the first quarter of 2009 as the lower materials prices are reflected in our cost of sales. In spite of the global economic slowdown, we believe our relationships with our top customers remain stable and that our products will continue to gain wider acceptance among major electrical equipment original equipment manufacturers (“OEMs”) in China and around the world”.

 

We were pleased to see steady improvement to our balance sheet in 2008. We finished the year with $15.0 million in cash even after taking into account an $18.5 million increase in fixed asset expenditures associated with our Wuhan and Shanghai manufacturing facilities. We also managed to reduce our short-term bank loans by approximately $12.0 million since the third quarter.

 

Our accounts receivables increased largely due to strong international sales. We also implemented new credit policies that improved the quality of our accounts receivables as evidenced by our lower bad debt reserves. We continue to increase our cash flow from operations and believe that the new policies implemented for inventories and accounts receivable will benefit our operating cash flow. Overall, our financial structure at the end of 2008 is much improved over the prior year despite substantial growth in the size and structure of our operations.”

 

2009 Financial Outlook

 

For the full year 2009, the Company currently anticipates revenues of approximately $176 million to $ 182 million, a 14% to 18% increase over 2008 sales of $154 million. The Company anticipates net income of approximately $22.5 million to $23.3 million, a 14% to 18% increase over 2008 net income of $19.8 million. The Company anticipates diluted earning per share for 2009 to be $2.75 to $2.85 per share.

 

Mr. Li continued, “We are encouraged by our continued success. We are also aware of the challenges facing us in the current economic environment. Thus, we are taking a more cautious approach. Our growth plan for 2009 continues to focus on penetrating the power generation equipment market with our high-quality transformer and wind energy products. We believe that 2009 will be a solid year for Jinpan as we continue to meet the needs of our customers, which includes OEMs, electric utilities, industries, and commercial property developers. Our Wuhan facility is fully operational and we expect to operate the Wuhan facility at full capacity by the end of 2009. We are focused on product customization at competitive prices and expansion of international sales. Global demand for efficient, reliable, customized power generation equipment continues to be robust and Jinpan is emerging as a major player in this high growth area. We are

 

optimistic that Jinpan’s strong and flexible balance sheet, innovative products and persistent work ethic will continue drive our company forward to achieve even greater success.”

 

Conference Call Information

Jinpan’s management will host an earnings conference call today, March 30, 2009 at 8:30 a.m. U.S. Eastern Standard Time. Listeners may access the call by dialing 1-913-981-5595. A webcast will also be available via the Company’s website at http://www.jstusa.net/ . A replay of the call will be available through April 13, 2009. Listeners may access the replay by dialing 1-719-457-0820, access code: 4867406.

About Jinpan International Ltd

Jinpan International Ltd. (Nasdaq: JST) designs, manufactures and distributes cast resin transformers for voltage distribution equipment in China and other countries around the world. Jinpan’s cast resin transformers allow high voltage transmissions of electricity to be distributed to various locations at lower, more usable voltage levels. The Company has obtained ISO9001 and ISO1401 certification of its cast resin transformers. Its principal executive offices are located in Hainan, China and its U.S. headquarters is based in Englewood Cliffs, New Jersey.

Safe Harbor Provision

This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations and observations and involve known and unknown risks, uncertainties or other factors not under the Company’s control, which may cause actual results, performance or achievements of the company to be materially different from the results, performance or other expectations implied by these forward-looking statements. These factors include, but are not limited to, the following:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Except as required by law, we are not under any obligation, and expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.

 

Investor Contact Information :

 

At Jinpan International Ltd.

Mark Du

Chief Financial Officer

(201)227-0680

 

At ICR, Inc.:

In China:

William Zima

+86 10 6599 7969

 

In U.S.

Brian M. Prenoveau, CFA

+203 682 8200

 

 

(Financial tables on the following page)

 

Jinpan International Limited and Subsidiaries

Consolidated Statements of Income (unaudited)

For the Three and Twelve Month Periods Ended December 31, 2008

 

 

 

Jinpan International Limited and Subsidiaries

Consolidated Balance Sheets (unaudited)

As of December 31, 2008

 

		Dec 31
		2008		2007
		US$			US$
Assets
Current assets:
Cash and cash equivalents		$	15,393		$	15,705
Restricted Cash			1,331			1,417
Investment available for sales			15			193
Accounts receivable, net			58,793			43,026
Inventories			31,868			25,743
Prepaid expenses			4,713			7,943
Other receivables			7,317			2,969
Total current assets			119,430			96,996
Property, plant and equipment, net			18,213			9,031
Construction in progress			6,055			2,889
Intangible assets			12,348			11,549
Prepaid Land used Right			6,098			—
Deferred tax assets			301			807
Total assets		$	162,445		$	121,272
Liabilities and Shareholders’ Equity
Current liabilities:
Short term bank loans		$	11,726		$	9,874
Accounts payable			11,300			6,372
Income tax			3,671			2,353
Advance from customers			7,828			4,638
Other Payable			20,733			15,292
Total current liabilities		$	55,258		$	38,529
Shareholders’ equity:
Common stock, US$0.009 par value:
Authorized shares - 20,000,000
Issued and outstanding shares - 8,195,434 in 2008 and 8,186,617 in 2007		$	73		$	73
Common Stock, Warrants			854			854
Convertible preferred stock, US$0.009 par value:
Authorized shares - 1,000,000
Issued and outstanding shares – 3,055 in 2008 6,111 2007			1			1
Additional paid-in capital			34,035			33,938
Reserves			3,905			3,905
Retained earnings			60,266			39,659
Accumulated other comprehensive income			8,842			5,102
			107,976			83,532
Less: Treasury shares at cost, common stock - 206,470 in 2008 and 206,470 in 2007			(789	)		(789	)
Total shareholders’ equity		$	107,187		$	82,743
Total liabilities and shareholders’ equity		$	162,445		$	121,272

 

 

Jinpan International Limited and Subsidiaries

Consolidated Statements of Cash Flows

For the Twelve Months Ended December 31, 2008(Unaudited)