CARLSTADT, N.J., Nov. 13, 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 third quarter
ending September 30, 2013.
Third Quarter 2013 Results
Net sales for the third quarter were $68.7 million, a 16.8% increase from $58.8 million in the same period last year.
The increase was driven by robust growth in the Chinese market and
a strong recovery in international sales. In the third
quarter, China sales increased 14%
year-over-year to $58.6 million, or
85.3% of net sales, compared to $51.6
million, or 87.8% of net sales in the same period last year.
Net sales outside of China for the
quarter increased 40% year-over-year to $10.1 million, or 14.7% of net sales, compared to
$7.2 million, or 12.2% 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
increased 14% year-over-year to $62.8
million, or 91.4% of net sales in the third quarter, while
wind energy products (cast resin transformers and VPI reactors for
wind power applications) represented $5.9
million, or 8.6% of net sales during this quarter.
Gross profit in the third quarter increased 21.8% year over year
to $23.9 million from $19.6 million in the same period last year.
Third quarter 2013 gross profit margin was 34.8%, compared to 33.3%
in the prior year period, and 34.8% in the second quarter of 2013.
Gross margin in the third 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 third quarter were
$16.2 million, or 23.6% of net sales,
compared to $14.8 million, or 25.2%
of net sales in the same period last year. Selling and
administrative expenses increased from the same period last year
due to higher sales volume and increased expenses associated with
the newly operational Guilin facility.
Operating income for the third quarter increased 60.9% to
$7.7 million, or 11.2% of net sales,
from $4.8 million, or 8.1% of net
sales, in the same period last year.
Net income for the third quarter increased 78.7% to $7.0 million, or $0.42 per diluted share, compared to $3.9 million, or $0.23 per diluted share, in the same period last
year. Third quarter net income, as a percentage of net sales,
was 10.1% compared to 6.6% in the same period last year.
Mr. Zhiyuan Li, Chief Executive
Officer of Jinpan International, stated, "We are pleased with our
operating and financial results for the third quarter, during which
we generated a record level of revenue and achieved double-digit
operating margins. We continue to 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.
"Production of cast resin transformers and switchgear at our new
facility in Guilin is ramping up nicely. We are well on track
to achieve our cast resin transformer production target of 2
million to 3 million KVA from the Guilin facility during
2013. This additional capacity enabled us to achieve a
historical high in revenue during the quarter. We will
continue to expand production from Guilin in a measured manner over
the next several quarters and anticipate steady margin expansion as
capacity utilization increases.
"Our international OEM business continued its positive momentum
during the third quarter, driven primarily by shipments to our
largest OEM customer. We anticipate continued demand within
the wind power sector well into 2014, but expect order volume could
be lumpy. We made progress with our efforts to qualify with
additional OEMs and remain focused on building on these
partnerships to expand global
reach.
"Within China, the economy is transitioning to a slower pace of
growth and the government's infrastructure investments are measured
and targeted. We believe Jinpan is aligned with sectors that
are poised to experience growth over the next several years,
including subway projects and solar power generation
projects. We are confident that our brand recognition, scale,
and cost structure position us to compete favorably within the
domestic market.
"At the end of September, our backlog equaled $105 million, up 1% from the prior year period
and down 27.6% from the second quarter of 2013. Product
shipments for several large projects were accelerated into the
third quarter, which generated record revenue while also reducing
our backlog. We anticipate backlog will recover over the
coming quarters."
Balance Sheet
As of September 30, 2013, the
Company had $18.3 million in cash,
cash equivalents, and short term investments, compared to
$29.6 million as of December 31, 2012. The Company's accounts
receivable on September 30, 2013
totaled $151.1 million, compared to
$124.6 million as of December 31, 2012. Total bank loans
outstanding at September 30, 2013
were $47.9 million, compared to
$44.0 million at December 31, 2012.
Financial Outlook
The company is adjusting its guidance for full year fiscal 2013,
projecting net sales of $219 million to $222
million and net income in the range of $16.0 million to $16.5 million, or $0.96 to $0.99 per share, which represents
earnings growth of approximately 14% to 17% compared to 2012.
Conference Call Information
Jinpan's management will host a conference call and webcast on
Thursday, November 14, 2013 at
8:30 a.m. Eastern Time.
Listeners may access the call by dialing 1-888-596-2572 (toll
free) or 1-913-312-0961 (international). A webcast will also be
available via http://public.viavid.com, with event ID: 106714. A
replay of the call will be available through November 28, 2013 by dialing 1-877-870-5176,
access code 1018691.
ABOUT JINPAN INTERNATIONAL
Jinpan International Ltd. (NASDAQ: JST) designs, manufactures,
and markets electrical control and distribution equipment used in
demanding industrial applications, utility projects, renewable
energy installations, and infrastructure projects. Major
products include cast resin transformers, VPI transformers and
reactors, switchgears, and unit substations. Jinpan serves a
wide range of customers in China
and reaches international markets as a qualified supplier to
leading global industrial electrical equipment manufacturers.
Jinpan's four manufacturing facilities in China are located in the cities of
Haikou, Wuhan, Shanghai and Guilin. The Company's
manufacturing facilities in China
comprise the largest cast resin transformer production capacity in
that country. The Company was founded in 1993. Its principal
executive offices are located in Haikou, Hainan,
China and its United States
office is based in Carlstadt, New
Jersey. For more information, visit
www.jinpaninternational.com.
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.
FINANCIAL STATEMENTS FOLLOW:
Jinpan
International Limited and Subsidiaries Consolidated
Statements of Comprehensive Income (unaudited) For the
Three and Nine Month Periods Ended September 30,
2013
|
|
|
|
|
|
|
Three months
ended
|
Nine months
ended
|
|
|
Sept 30
|
Sept 30
|
|
|
|
|
|
|
|
|
2013
|
2012
|
2013
|
2012
|
(In thousands, except
number of shares and per share data)
|
|
US$
|
US$
|
US$
|
US$
|
|
|
|
|
|
|
Net Sales
|
|
68,743
|
58,832
|
162,579
|
157,115
|
Cost of Goods
Sold
|
|
(44,853)
|
(39,225)
|
(106,572)
|
(104,635)
|
Gross
Profit
|
|
23,890
|
19,607
|
56,007
|
52,480
|
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
|
|
Selling and
Administrative
|
|
(16,187)
|
(14,819)
|
(41,541)
|
(39,922)
|
Operating
Income
|
|
7,703
|
4,788
|
14,466
|
12,558
|
|
|
|
|
|
|
Interest
Expenses
|
|
(579)
|
(355)
|
(1,341)
|
(1,441)
|
Other
Income
|
|
1,209
|
357
|
1,856
|
936
|
Income before Income
Taxes
|
|
8,333
|
4,790
|
14,981
|
12,053
|
|
|
|
|
|
|
Income
Taxes
|
|
(1,357)
|
(886)
|
(2,482)
|
(1,827)
|
Net Income after
Taxes
|
|
6,976
|
3,904
|
12,499
|
10,226
|
|
|
|
|
|
|
Other Comprehensive
Income (loss)
|
|
|
|
|
|
Foreign
Currency Translation Adjustment
|
|
(12)
|
2
|
(13)
|
(53)
|
Total Comprehensive
Income
|
|
6,964
|
3,906
|
12,486
|
10,173
|
|
|
|
|
|
|
Earnings per
Share
|
|
|
|
|
|
|
|
|
|
|
|
-Basic
|
|
US$ 0.43
|
US$ 0.24
|
US$ 0.77
|
US$ 0.63
|
|
|
|
|
|
|
-Diluted
|
|
US$ 0.42
|
US$ 0.23
|
US$ 0.75
|
US$ 0.61
|
|
|
|
|
|
|
Weighted Average
Number of Shares
|
|
|
|
|
|
|
|
|
|
|
|
-Basic
|
|
16,216,704
|
16,168,251
|
16,216,704
|
16,168,251
|
|
|
|
|
|
|
-Diluted
|
|
16,609,978
|
16,709,705
|
16,603,938
|
16,718,793
|
|
|
|
|
|
|
|
|
|
|
Jinpan
International Limited and Subsidiaries Consolidated
Balance Sheet
|
|
|
|
|
|
(Unaudited)
|
|
(Audited)
|
|
September 30,
2013
|
|
December 31,
2012
|
(In thousands, except
number of shares and per share data)
|
|
|
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
12,232
|
|
18,510
|
Restricted
cash
|
929
|
|
824
|
Short-term
investment
|
6,018
|
|
11,137
|
Notes
receivable
|
8,216
|
|
15,720
|
Accounts receivable,
net
|
151,121
|
|
124,608
|
Inventories,
net
|
44,410
|
|
29,565
|
Prepaid
expenses
|
8,321
|
|
2,528
|
Land use
right
|
367
|
|
366
|
Deferred tax
assets
|
1,952
|
|
1,339
|
Other
receivables
|
7,412
|
|
5,900
|
Total current
assets
|
240,978
|
|
210,497
|
|
|
|
|
Property, plant and
equipment, net
|
69,836
|
|
41,361
|
Construction-in-progress
|
6,019
|
|
29,196
|
Land use
right
|
14,817
|
|
14,760
|
Goodwill
|
13,703
|
|
13,403
|
Other
assets
|
123
|
|
32
|
Deferred tax
assets
|
34
|
|
34
|
|
|
|
|
Total
assets
|
345,510
|
|
309,283
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
Short-term bank
loans
|
15,382
|
|
17,644
|
Accounts
payable
|
32,620
|
|
25,029
|
Notes
Payable
|
8,689
|
|
6,008
|
Income tax
payable
|
2,962
|
|
1,880
|
Advances from
customers
|
14,352
|
|
13,624
|
Other
liabilities
|
26,265
|
|
22,844
|
Total current
liabilities
|
100,270
|
|
87,029
|
Commitments and
contingencies
|
|
|
|
Long term
liability:
|
|
|
|
Deferred Income
|
4,048
|
|
3,080
|
Long Term bank
loans
|
32,554
|
|
26,315
|
|
136,872
|
|
116,424
|
Total
Liabilities
|
|
|
|
Shareholders'
equity:
|
|
|
|
Convertible preferred
stock, US$0.0045 par value:
|
|
|
|
Authorized shares -
2,000,000
|
|
|
|
Issued and outstanding
shares – none in 2012 and 2011
|
-
|
|
-
|
Common stock,
US$0.0045 par value:
|
|
|
|
Authorized shares –
40,000,000
|
|
|
|
Issued and
outstanding shares –16,415,456 in 2013 and 16,395,456 in
2012
|
74
|
|
74
|
Common
stock-warrants
|
-
|
|
-
|
Additional paid-in
capital
|
37,552
|
|
37,374
|
Reserves
|
12,023
|
|
12,023
|
Retained
earnings
|
134,102
|
|
123,065
|
Accumulated other
comprehensive income
|
25,203
|
|
20,781
|
|
208,954
|
|
193,317
|
Less: Treasury shares
at cost,
|
|
|
|
Common stock –135,306
in 2013 and 215,306 in 2012
|
(316)
|
|
(458)
|
Total shareholders'
equity
|
208,638
|
|
192,859
|
|
|
|
|
Total liabilities and
shareholders' equity
|
345,510
|
|
309,283
|
|
|
|
|
|
|
|
|
|
Jinpan
International Limited and Subsidiaries Consolidated
Statement of Cash Flows For the Nine Months Ended
September 30, 2013 (Unaudited)
|
|
|
|
For the Nine Months
Ended
|
|
September
30,
|
|
2013
|
|
2012
|
(In
thousands)
|
US$
|
|
US$
|
|
|
|
|
Operating
Activities
|
|
|
|
Net Income
|
12,499
|
|
10,226
|
Adjustments to
reconcile net income to
|
|
|
|
Net Cash provided by (used in ) operating activities:
|
|
|
|
Depreciation
|
4,759
|
|
3,822
|
Amortization of prepaid lease
|
278
|
|
273
|
Deferred Income Tax
|
(576)
|
|
(255)
|
Provision for doubtful debts
|
3,306
|
|
1,604
|
Loss/(gain) on disposal of fixed assets
|
-
|
|
(4)
|
Stock-based compensation Cost
|
105
|
|
211
|
Changes in operating
assets and liabilities
|
|
|
|
Restricted Cash
|
(86)
|
|
(534)
|
Accounts Receivable
|
(26,769)
|
|
(24,325)
|
Notes
Receivable
|
7,770
|
|
8,811
|
Inventories
|
(14,027)
|
|
(536)
|
Prepaid Expenses
|
(2,030)
|
|
1,885
|
Other Receivable
|
(1,455)
|
|
(3,994)
|
Accounts Payable
|
6,953
|
|
4,223
|
Notes Payable
|
2,519
|
|
(3,292)
|
Income Tax
|
1,029
|
|
(328)
|
Advance From customers
|
418
|
|
3,310
|
Other liabilities
|
2,903
|
|
(58)
|
Net Cash provided by
( used in ) operating activities
|
(2,404)
|
|
1,039
|
Investing
activities
|
|
|
|
Purchases of property, plant
and equipment
|
(5,492)
|
|
(6,270)
|
Proceeds from sales of
property, plant and equipment
|
-
|
|
28
|
Payment for construction in
progress
|
(6,590)
|
|
(14,619)
|
Sell of short term
investment
|
42,159
|
|
-
|
Increase in short term
investment
|
(36,851)
|
|
-
|
Receipt of government grant
for new plant construction
|
885
|
|
2,859
|
Net Cash provided by
( used in ) investing activities
|
(5,889)
|
|
(18,002)
|
Financing
activities
|
|
|
|
Proceeds from bank
loan
|
23,633
|
|
46,890
|
Repayment of bank
loan
|
(20,673)
|
|
(35,881)
|
Proceeds from exercised
stock option
|
215
|
|
22
|
Dividend paid
|
(1,461)
|
|
(2,264)
|
Net Cash provided by
( used in ) financing activities
|
1,714
|
|
8,767
|
Effect of exchange
rate changes on cash
|
301
|
|
(67)
|
Net
increase/(decrease) in cash and cash equivalents
|
(6,278)
|
|
(8,263)
|
Cash and Cash
equivalents at beginning of year
|
18,510
|
|
24,218
|
Cash and Cash
equivalents at end of year
|
12,232
|
|
15,955
|
|
|
|
|
Interest
paid
|
1,849
|
|
1,418
|
Income Tax
paid
|
1,587
|
|
2,397
|
SOURCE Jinpan International Ltd.