- 1Q09 Net Sales Increases 36.1% to $ 32.4 Million Compared to 1Q08
- ENGLEWOOD CLIFFS, N.J., May 15 /PRNewswire-FirstCall/ -- 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
first quarter ended March 31, 2009. Net sales for the first quarter
were $32.4 million, a 36.1% increase from $23.8 million over the
same period last year. Growth in net sales was fueled by both a
sizeable increase of international orders, which include wind
energy products and non-wind related cast resin transformers as
well as from increased domestic cast resin sales orders. In the
first quarter, net sales outside of China increased 485% to $8.0
million, or 25% of net sales, compared to $1.65 million, or 6.9% of
net sales in the same period last year. First quarter domestic
sales increased 10.2% to $24.4 million from $22.2 million in the
prior year period. Cast resin transformers (excluding those for
wind power applications), switch gears and unit substations
represented $25.9 million, or 80% of net sales in the first
quarter, while wind energy products represented $6.5 million, or
20% of net sales in the first quarter. Gross margin in the first
quarter was $11.7 million, a 56% increase from $7.5 million, in the
same period last year. First quarter gross margin increased to
36.2% compared to 31.3% in the same period last year. The Company
benefited from a lower cost of sales on an absolute basis due to
lower raw material prices compared to the same period last year.
Selling, general and administrative expenses in the first quarter
were $6.2 million, or 19.2% of net sales, versus $4.5 million, or
18.8% of net sales in the same period last year. Selling, general,
and administrative expenses increased primarily due to additional
overhead costs at the Company's Wuhan and Shanghai facilities,
which were not operating during the same period last year.
Operating income increased to $5.5 million, or 16.9% of net sales,
an 83.5% increase compared to $3.0 million, or 12.6% of net sales
in the same period last year. Net income for the first quarter was
$4.7 million, or $0.58 per diluted share, increased 94.9% compared
with $2.4 million or $0.30 per diluted share, in the same period
last year. First quarter net income as a percentage of net sales
was 14.4% as compared to 10.1% in the same period last year. Mr.
Zhiyuan Li, Chief Executive Officer of Jinpan commented, "We are
off to a good start in what is traditionally one of our slower
quarters of the year. We are pleased to see a substantial increase
in orders from our international business segment in the first
quarter. Our international customers are placing orders for cast
resin transformers for wind power applications as well as
transformers for more traditional power generation applications
used in urban (trains & subways, hospitals, airports, office
buildings), industrial (factories), and commercial developments
(processing plants, data centers). We expect a steady rise in
international demand in 2009 as we continue to garner attention and
receive orders from some of the largest, most prominent electrical
equipment OEMs in the industry. We expect international sales to
account for a greater portion of our total sales in 2009 than 2008.
We are pleased to see that a substantial portion of China's $585
billion economic stimulus plan will be allocated to the
infrastructure development projects. We believe that we are well
positioned to benefit from the stimulus package As such, we are
taking the necessary steps to ensure we have an appropriate level
of capacity to meet demand over the next several quarters and well
into the future. Our newest operational facility in Wuhan, which
currently manufactures our standard cast resin transformers will be
outfitted to maximize capacity by the end of 2009 while our
Shanghai manufacturing facility is also expected to be completed in
the third quarter of 2009. Once completed, this facility will house
all of our wind related products. We are making steady progress in
our business. We believe that we are well positioned to capitalize
on current challenging market conditions, penetrate new markets,
and expand our market share in the electrical equipment market. We
have a strong balance sheet, a healthy cash position, manageable
debt and the right strategic plan to sustain ably manage our
business for growth this year and beyond. We look forward to
capitalizing on our opportunities and enhancing value for our
shareholders," concluded Mr. Li. Financial Outlook For the full
year 2009, the Company currently anticipates net sales 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 earnings per share for 2009 to be $2.75 to
$2.85 per share. Conference Call Information Jinpan's management
will host an earnings conference call today, May 15, 2009 at 8:30
a.m. U.S. Eastern Standard Time. Listeners may access the call by
dialing #1-913-981-5567. A webcast will also be available via the
Company's website at http://www.jstusa.net/ or at
http://www.viavid.net/. A replay of the call will be available
through May 29, 2009. Listeners may access the replay by dialing
#1-719-457-0820, access code: 7695004. 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, and 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: -- our
ability to successfully implement our business strategy; -- the
impact of existing and new competitors in the markets in which we
compete, including competitors that may offer less expensive
products and services, more desirable or innovative products or
technological substitutes, or have more extensive resources or
better financing; -- the effects of rapid technological changes and
vigorous competition in the markets in which we operate; --
uncertainties about the future growth in electricity consumption
and infrastructure development in the markets in which we operate;
-- uncertainties about the degree of growth in the number of
consumers in the markets in which we operate using mobile personal
communications services and the growth in the population in those
areas; -- other factors or trends affecting the industry generally
and our financial condition in particular; -- the effects of the
higher degree of regulation in the markets in which we operate; --
general economic and political conditions in the countries in which
we operate or other countries which have an impact on our business
activities or investments; -- the monetary and interest rate
policies of the countries in which we operate; -- changes in
competition and the pricing environments in the countries in which
we operate; -- exchange rates; and -- other factors listed from
time-to-time in our filings with the Securities and Exchange
Commission, including, without limitation, our Annual Report on
Form 20-F for the period ended December 31, 2007 and our subsequent
reports on Form 6-K. 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. Jinpan International
Limited and Subsidiaries Consolidated Statements of Income
(unaudited) Three months ended March 31 2009 2008 (In thousands,
except per share data) US$ US$ Net sales 32,387 23,798 Cost of
Goods Sold (20,672) (16,339) Gross Margin 11,715 7,459 Operating
Expenses Selling and administrative (6,230) (4,470) Operating
income 5,485 2,989 Interest Expenses (105) (179) Other Income 51
183 Income before income taxes 5,431 2,993 Income taxes (753) (593)
Net income after taxes 4,678 2,400 Earnings per share -Basic
US$0.58 US$0.30 -Diluted US$0.58 US$0.30 Weighted average number of
shares -Basic 7,998,325 7,984,147 -Diluted 8,017,528 8,117,923
Jinpan International Limited and Subsidiaries Consolidated Balance
Sheets (unaudited) March 31, December 31, 2009 2008 US$ US$ Assets
Current assets: Cash and cash equivalents 14,922 16,739 Accounts
receivable, net 61,276 58,793 Inventories 30,042 31,868 Prepaid
expenses 7,001 4,713 Other receivables 5,224 7,317 Total current
assets 118,465 119,430 Property, plant and equipment, net 18,430
18,213 Construction in progress 6,326 6,055 Land use right 6,080
6,098 Intangible asset-Goodwill 12,328 12,348 Deferred tax assets
293 301 Total assets 161,922 162,445 Liabilities and Shareholders'
Equity Current liabilities: Short term bank loans 11,158 11,726
Accounts payable 11,051 11,300 Income tax 2,835 3,671 Advance from
customers 8,128 7,828 Other Payable 17,933 20,733 Total current
liabilities 51,105 55,258 Shareholders' equity: Common stock,
US$0.009 par value: Authorized shares - 20,000,000 Issued and
outstanding shares - 8,209,684 in 2009 and 8,189,684 in 2008 74 73
Common Stock, Warrants 854 854 Convertible preferred stock,
US$0.009 par value: Authorized shares - 1,000,000 Issued and
outstanding shares - 3,044 in 2008 and 2009 - - Additional paid-in
capital 34,164 34,035 Reserves 3,906 3,906 Retained earnings 64,004
60,296 Accumulated other comprehensive income 8,604 8,812 111,606
107,976 Less: Treasure shares at cost, common stock-206,470 in 2009
and 206,470 in 2008 (789) (789) Total shareholders' equity 110,817
107,187 Total liabilities and shareholders' equity 161,922 162,445
Jinpan International Limited and Subsidiaries Consolidated
Statements of Cash Flows (Unaudited) Three months ended March 31,
2009 2008 US$ US$ Operating activities Net income 4,678 2,400
Adjustments to reconcile net income to net cash provided by/(used
in) operating activities: Depreciation 874 360 Provision for
Doubtful Debt (4) - Loss/(Gain) on disposal of fixed assets - -
Deferred Income Tax 7 20 Stock-based compensation cost 102 Changes
in operating assets and liabilities Accounts receivable (2,576)
(2,391) Notes receivable 1,551 (7) Inventories 1,776 (6,351)
Prepaid expenses (2,298) 1,430 Other receivables 532 172 Accounts
payable (231) (597) Income tax (831) (104) Advance from customers
313 891 Other liabilities (2,769) (336) Net cash provided by/(used
in) operating activities 1,124 (4,513) Investing activities
Purchases of property, plant and equipment (1,113) (258) Proceeds
from sales of property, plant and equipment - - Payment for
construction in progress (280) (726) Purchase of available-for
-sales securities - (1,956) Net cash provided by (used in)
investing activities (1,393) (2,940) Financing activities Proceeds
from bank loan 2,380 4,434 Repayment of bank loan (2,929) (2,281)
Proceeds from exercise of stock options 27 - Decrease in Minority
Interest - - Acquired minority interest - - Dividends paid (970)
(967) Net cash provided by/(used in) financing activities (1,492)
1,186 Effect of exchange rate changes on cash (56) 139 Net
increase/(decrease) in cash and cash equivalents (1,817) (6,128)
Cash and cash equivalents at beginning of year 16,739 17,122 Cash
and cash equivalents at end of year 14,922 10,994 Interest paid 112
292 Income taxes paid 1,522 686 DATASOURCE: Jinpan International
Ltd CONTACT: Mark Du, Chief Financial Officer of Jinpan
International Ltd., +1-201-227-0680, or U.S., Brian M. Prenoveau,
CFA, +1-203-682-8200, China, William Zima, +86 10 6599 7969, both
of ICR, Inc. for Jinpan International Ltd Web Site:
http://www.jstusa.net/
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