CARLSTADT, N.J., Aug. 14, 2013 /PRNewswire/ -- Jinpan
International Ltd. (Nasdaq: JST), a leading designer, manufacturer,
and distributor of cast resin transformers, today reported
unaudited consolidated financial results for the second quarter
ending June 30, 2013.
Second Quarter 2013 Results
Net sales for the second quarter were $58.7 million, a 5.6% increase from $55.5 million in the same period last year.
The increase was driven by strong growth in international sales and
modest growth in the Chinese market. In the second quarter,
China sales accounted for
$52.6 million, or 89.6% of net sales,
compared to $51.2 million, or 92.3%
of net sales in the same period last year. Net sales outside
of China for the quarter were
$6.1 million, or 10.4% of net sales
compared to $4.3 million, or 7.7% of
net sales for the same period last year.
The sales of cast resin and VPI transformers (excluding those
for wind power applications), switchgears and unit substations
represented $53.3 million, or 90.8%
of net sales in the second quarter, while wind energy products
(cast resin transformers and VPI reactors for wind power
applications) represented $5.4
million, or 9.2% of net sales during this quarter.
Gross profit in the second quarter increased 19.2% year over
year to $20.4 million from
$17.1 million in the same period last
year. Second quarter 2013 gross profit margin was 34.8%,
compared to 30.8% in the prior year period, and 33.3% in the first
quarter of 2013. Gross margin in the second quarter increased
compared to the same period last year due to a stabilized pricing
environment, favorable raw material costs, and an increased mix of
international sales, which typically carry higher margins.
Selling and administrative expenses in the second quarter were
$15.0 million, or 25.5% of net sales,
compared to $14.2 million, or 25.6%
of net sales in the same period last year. Selling and
administrative expenses increased from the same period last year
due to higher sales and increased expenses associated with the
newly operational Guilin facility.
Operating income for the second quarter increased 85.3% to
$5.4 million, or 9.2% of net sales,
from $2.9 million, or 5.3% of net
sales, in the same period last year.
Net income for the second quarter increased 85.8% to
$4.4 million, or $0.26 per diluted share, compared to $2.4 million, or $0.14 per diluted share, in the same period last
year. Second quarter net income, as a percentage of net
sales, was 7.5% compared to 4.2% in the same period last year.
Mr. Zhiyuan Li, Chief Executive
Officer of Jinpan International, stated, "We are pleased with our
second quarter results, which reflect a return to revenue and
earnings growth as we are seeing contribution from the strategies
we have implemented and investments we have made over the past
several years. With this major investment phase largely
complete, we now intensify our focus on the disciplined execution
of our growth strategy as we ramp up our Guilin facility, develop
new products, expand our international OEM business, and increase
our penetration of the domestic market. At the end of June,
our backlog increased to $145
million, up 26% from the prior year period and up 2% from
the first quarter of 2013.
"The ramp-up of our Guilin facility is progressing as planned
and we made our first shipments of cast resin transformers from
this facility during the second quarter. Jinpan's total
production capacity for cast resin transformers is now 17 million
KVA, which we believe positions us as the largest manufacturer of
cast resin transformers in China. We plan to expand
production from this facility in a measured and efficient manner
over the next several quarters.
"Jinpan had several positive developments with its OEM
business. As expected, during the second quarter we resumed
volume shipments to our largest OEM customer, supplying a newly
designed cast resin transformer for its next generation wind
turbine platform. Wind energy sales more than doubled from
the first quarter of 2013 and we anticipate continued growth
through the end of the year. We continued shipments to our two
other OEM customers. We are also pleased to report that we
have successfully passed qualification with a Europe-based wind turbine manufacturer and
have received initial orders. Finally, we made progress with
qualification with two additional OEMs.
"Within the Chinese market, the government continues to invest
in infrastructure; however, the spending is more targeted and
measured than in previous years. We believe our technical
capabilities and the scale and improved efficiency of our Guilin
facility position us to capture market share and drive productivity
within this slower-growth environment."
Balance Sheet
As of June 30, 2013, the Company
had $14.2 million in cash and cash
equivalents, compared to $18.5
million as of December 31,
2012. The Company's accounts receivable on June 30, 2013 totaled $143.7 million, compared to $124.6 million as of December 31, 2012. Total bank loans
outstanding at June 30, 2013 were
$49.4 million, compared to
$44.0 million at December 31, 2012.
Financial Outlook
The Company reiterates its guidance for 2013, projecting net
sales of $231 million to $241
million, an increase of 10% to 15% over 2012, and net income
of $14.0 million to $14.5 million, or $0.84 to
$0.87 per share, which represents an increase of 0% to 3%
compared to 2012.
Conference Call Information
Jinpan's management will hold a conference call on Wednesday, August 14, 2013 at 8:30 a.m. Eastern Time. Listeners may
access the call by dialing 1-888-727-7615 (toll free) or
1-913-312-0655 (international). A webcast will also be
available via http://public.viavid.com, with event ID:
105623. A replay of the call will be available through
August 28, 2013 by dialing
1-877-870-5176, access code 8399159.
ABOUT JINPAN INTERNATIONAL
Jinpan International Ltd. (NASDAQ: JST) designs, manufactures,
and markets equipment for the distribution of electricity,
including cast resin transformers, VPI transformers and reactors,
switchgears, and unit substations. Jinpan's cast resin
transformers allow high voltage transmissions of electricity to be
distributed to various locations in lower, more usable
voltages. Its principal executive offices are located in
Haikou, Hainan, China and its United States office is based in Carlstadt, New Jersey.
Safe Harbor Regarding Forward Looking Statements
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 are
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, 2012 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 Comprehensive Income (unaudited)
For the Three and Six Month Periods Ended June 30,
2013
|
|
|
|
Three months
ended
|
Six months
ended
|
|
|
June 30
|
June 30
|
|
|
|
|
|
|
|
|
2013
|
2012
|
2013
|
2012
|
(In thousands, except
number of shares and per
share data)
|
|
US$
|
US$
|
US$
|
US$
|
|
|
|
|
|
|
Net sales
|
|
58,664
|
55,529
|
93,836
|
98,283
|
Cost of Goods
Sold
|
|
(38,266)
|
(38,418)
|
(61,718)
|
(65,410)
|
Gross
Margin
|
|
20,398
|
17,111
|
32,118
|
32,873
|
|
|
|
-
|
|
|
Operating
Expenses
|
|
|
|
|
|
Selling and
administrative
|
|
(14,983)
|
(14,188)
|
(25,354)
|
(25,103)
|
Operating
income
|
|
5,415
|
2,923
|
6,764
|
7,770
|
|
|
|
|
|
|
Interest
Expenses
|
|
(494)
|
(627)
|
(762)
|
(1,086)
|
Other
Income
|
|
274
|
364
|
646
|
579
|
Income before income
taxes
|
|
5,195
|
2,660
|
6,648
|
7,263
|
|
|
|
|
|
|
Income
taxes
|
|
(815)
|
(302)
|
(1,125)
|
(941)
|
Net income after
taxes
|
|
4,380
|
2,358
|
5,523
|
6,322
|
|
|
|
|
|
|
Other comprehensive
income (loss)
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
3
|
16
|
(1)
|
(55)
|
Total comprehensive
income
|
|
4,383
|
2,374
|
5,522
|
6,267
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
-Basic
|
|
US$ 0.27
|
US$ 0.15
|
US$ 0.34
|
US$ 0.39
|
|
|
|
|
|
|
-Diluted
|
|
US$ 0.26
|
US$ 0.14
|
US$ 0.33
|
US$ 0.39
|
|
|
|
|
|
|
Weighted average
number of shares
|
|
|
|
|
|
-Basic
|
|
16,195,466
|
16,164,487
|
16,195,466
|
16,164,487
|
|
|
|
|
|
|
-Diluted
|
|
16,653,563
|
16,522,898
|
16,654,661
|
16,400,668
|
Jinpan
International Limited and Subsidiaries Consolidated
Balance Sheets
|
|
|
(Unaudited)
|
|
(Audited)
|
|
June 30,
|
|
December
31,
|
|
2013
|
|
2012
|
(In thousands, except
number of shares and per share data)
|
US$
|
|
US$
|
|
|
|
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
14,223
|
|
18,510
|
Restricted
cash
|
573
|
|
824
|
Short-term
investment
|
1,942
|
|
11,137
|
Notes
receivable
|
9,082
|
|
15,720
|
Accounts receivable,
net
|
143,730
|
|
124,608
|
Inventories,
net
|
41,794
|
|
29,565
|
Prepaid
expenses
|
8,583
|
|
2,528
|
Land use
right
|
367
|
|
366
|
Deferred tax
assets
|
1,757
|
|
1,339
|
Other
receivables
|
7,419
|
|
5,900
|
Total current
assets
|
229,470
|
|
210,497
|
|
|
|
|
Property, plant and
equipment, net
|
60,784
|
|
41,361
|
Construction-in-progress
|
15,050
|
|
29,196
|
Land use
right
|
14,835
|
|
14,760
|
Goodwill
|
13,635
|
|
13,403
|
Other
assets
|
126
|
|
32
|
Deferred tax
assets
|
34
|
|
34
|
|
|
|
|
Total
assets
|
333,934
|
|
309,283
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Short-term bank
loans
|
17,598
|
|
17,644
|
Accounts
payable
|
33,561
|
|
25,029
|
Notes
Payable
|
5,285
|
|
6,008
|
Income tax
payable
|
2,142
|
|
1,880
|
Advances from
customers
|
15,212
|
|
13,624
|
Other
liabilities
|
23,166
|
|
22,844
|
Total current
liabilities
|
96,964
|
|
87,029
|
|
|
|
|
Deferred Income
|
4,184
|
|
3,080
|
Long Term bank
loans
|
31,767
|
|
26,315
|
Total
Liabilities
|
132,915
|
|
116,424
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
Convertible preferred
stock, US$0.0045 par value:
|
|
|
|
Authorized shares -
2,000,000
|
|
|
|
Issued and outstanding
shares – none in 2013 and 2012
|
-
|
|
-
|
Common stock,
US$0.0045 par value:
|
|
|
|
Authorized shares –
40,000,000
|
|
|
|
Issued and
outstanding shares –16,415,456 in 2013 and 16,395,456 in
2012
|
74
|
|
74
|
Common
stock-warrants
|
-
|
|
-
|
Additional paid-in
capital
|
37,506
|
|
37,374
|
Reserves
|
12,023
|
|
12,023
|
Retained
earnings
|
127,615
|
|
123,065
|
Accumulated other
comprehensive income
|
24,151
|
|
20,781
|
|
201,369
|
|
193,317
|
Less: Treasury shares
at cost,
Common stock –154,306
in 2013 and 215,306 in 2012
|
(350)
|
|
(458)
|
Total shareholders'
equity
|
201,019
|
|
192,859
|
|
|
|
|
Total liabilities and
shareholders' equity
|
333,934
|
|
309,283
|
|
Jinpan
International Limited and Subsidiaries Consolidated
Statement of Cash Flows For the Six Months Ended June 30,
2013 (Unaudited)
|
|
|
|
For the Six Months
Ended
|
|
June 30
|
|
2013
|
|
2012
|
(In
thousands)
|
US$
|
|
US$
|
|
|
|
|
Operating
Activities
|
|
|
|
Net Income
|
5,523
|
|
6,322
|
Adjustments to
reconcile net income to
|
|
|
|
Net Cash provided by (used in) operating activities:
|
|
|
|
Depreciation
|
2,944
|
|
2,080
|
Amortization of prepaid lease
|
185
|
|
182
|
Deferred Income Tax
|
(391)
|
|
(114)
|
Provision for doubtful debts
|
1,868
|
|
973
|
Loss/(gain) on disposal of fixed assets
|
-
|
|
(4)
|
Stock-based compensation Cost
|
59
|
|
111
|
Changes in operating
assets and liabilities
|
|
|
|
Restricted Cash
|
263
|
|
301
|
Accounts Receivable
|
(18,690)
|
|
(12,747)
|
Notes Receivable
|
6,851
|
|
7,910
|
Inventories
|
(11,618)
|
|
(8,390)
|
Prepaid Expenses
|
(4,967)
|
|
3,024
|
Other Receivable
|
(1,498)
|
|
(2,501)
|
Accounts Payable
|
8,029
|
|
1,509
|
Notes Payable
|
(819)
|
|
(7,618)
|
Income Tax
|
227
|
|
(812)
|
Advance From customers
|
1,340
|
|
1,808
|
Other liabilities
|
(39)
|
|
(5,105)
|
Net Cash provided by
(used in) operating activities
|
(10,733)
|
|
(13,071)
|
Investing
activities
|
|
|
|
Purchases of property, plant
and equipment
|
(4,731)
|
|
(5,272)
|
Proceeds from sales of
property, plant and equipment
|
-
|
|
29
|
Payment for construction in
progress
|
(3,228)
|
|
(3,783)
|
Sell of short term
investment
|
11,232
|
|
-
|
Increase in short term
investment
|
(1,926)
|
|
-
|
Receipt of government grant
for new plant construction
|
1,038
|
|
2,649
|
Net Cash provided by
(used in) investing activities
|
2,385
|
|
(6,377)
|
Financing
activities
|
|
|
|
Proceeds from bank
loan
|
16,307
|
|
37,412
|
Repayment of bank
loan
|
(11,702)
|
|
(14,982)
|
Proceeds from exercised
stock option
|
181
|
|
21
|
Dividend paid
|
(973)
|
|
(1,129)
|
Net Cash provided by
(used in) financing activities
|
3,813
|
|
21,322
|
Effect of exchange
rate changes on cash
|
248
|
|
(87)
|
Net
increase/(decrease) in cash and cash equivalents
|
(4,287)
|
|
1,787
|
Cash and Cash
equivalents at beginning of year
|
18,510
|
|
24,218
|
Cash and Cash
equivalents at end of year
|
14,223
|
|
26,005
|
|
|
|
|
Interest
paid
|
1,274
|
|
1,087
|
Income Tax
paid
|
1,260
|
|
1,959
|
SOURCE Jinpan International Ltd.