CARLSTADT, N.J., May 14, 2014 /PRNewswire/ -- Jinpan
International Limited (Nasdaq: JST), a leading designer,
manufacturer, and distributor of cast resin transformers, today
reported unaudited consolidated financial results for the first
quarter ending March 31,
2014.
First Quarter 2014 Results
Net sales for the first quarter were $41.3 million, a 17.5% increase from $35.2 million in the same period last year.
Sales growth was driven by steady demand in the Chinese market,
increased sales of switchgears and unit substations, and expanded
sales to OEM customers.
In the first quarter, China
sales increased 15% year-over-year to $37.1
million, or 89.8% of net sales, compared to $32.2 million, or 91.6% of net sales in the same
period last year. Net sales outside of China for the quarter increased 40%
year-over-year to $4.2 million, or
10.2% of net sales, compared to $3.0
million, or 8.5% of net sales for the same period last
year.
Sales to OEM customers increased 36.6% year-over-year to
$6.5 million, or 15.8% of net sales,
compared to $4.8 million, or 13.6% of
net sales in the same period last year.
Gross profit in the first quarter increased 17.1% year over year
to $12.8 million from $10.9 million in the same period last year.
First quarter 2014 gross profit margin was 31.0%, compared to 31.0%
in the prior year period. Gross margin in the first quarter was
stable compared with the same period last year as slightly improved
pricing and lower production costs were offset by an increased mix
of lower margin products.
Selling and administrative expenses in the first quarter were
$10.9 million, or 26.3% of net sales,
compared to $9.6 million, or 27.2% 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 costs associated with the
establishment of the Guilin plant.
Operating income for the first quarter increased 43.9% to
$1.9 million, or 4.7% of net sales,
from $1.3 million, or 3.8% of net
sales, in the same period last year.
Net income for the first quarter increased 32.8% to $1.5 million, or $0.09 per diluted share, compared to $1.1 million, or $0.07 per diluted share, in the same period last
year. First quarter net income, as a percentage of net sales,
was 3.7% compared to 3.2% in the same period last year.
Mr. Zhiyuan Li, Chief Executive
Officer of Jinpan International, stated, "We are pleased with our
strong start to 2014, which builds on the positive momentum from
last year. We posted double-digit sales growth for the third
consecutive quarter. Our Guilin facility has enabled us to
enhance our position in the cast resin transformer market and to
further penetrate new and larger markets for switchgears and unit
substations.
Demand for our products remains healthy, driving a strong
increase in orders during the first quarter of 2014, which led to a
recovery in our backlog. We remain focused on serving our
core markets, with railroad, subway, wind power, and utility-scale
solar continuing to drive robust growth. Our switchgear and unit
substation products are gaining traction, as we seek to penetrate
these markets in China. Finally,
having qualified with six international OEM customers, we have
shifted our focus from expanding our OEM customer base to deepening
our relationships with these customers to increase our sales.
At the end of March, our backlog equaled $118 million, down 16.9% from the prior year
period and up 18.0% from the fourth quarter of 2013. Our
year-over-year backlog decline reflects the increased production of
standardized cast resin transformers from our Guilin facility,
which has accelerated our average cycle time and enabled us to
convert orders into revenue more quickly. We expect our
backlog will gradually increase as our business expands."
Balance Sheet
As of March 31, 2014, the Company
had $18.6 million in cash and cash
equivalents, restricted cash, and short term investments, compared
to $30.8 million as of December 31, 2013. The Company's accounts
receivable on March 31, 2014 totaled
$140.5 million, compared to
$144.6 million as of December 31, 2013. Total bank loans
outstanding at March 31, 2014 were
$43.2 million, compared to
$43.1 million at December 31, 2013.
Financial Outlook
The Company reiterates its guidance for the full year 2014,
projecting revenue and earnings growth of approximately 10% to 15%
compared to 2013. Net sales are expected to be in the range
of $248 million to $260 million and
net income is expected to be in the range of $18.2 million to $19.1 million, or $1.09 to $1.14 per share.
Conference Call Information
Jinpan's management will host a conference call and webcast on
Thursday, May 15, 2014, at
8:30 a.m. Eastern Time.
Listeners may access the call by dialing 1-888-264-8904 (toll free)
or 1-913-312-0686 (international). A webcast will also be
available via http://public.viavid.com, with event ID:
108983. A replay of the call will be available through
May 22, 2014, by dialing
1-877-870-5176, access code 2035761.
ABOUT JINPAN INTERNATIONAL
Jinpan International Limited (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 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, 2013 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
Month Period Ended March 31, 2014
|
|
|
|
|
|
Three months
ended
|
|
|
March 31
|
|
|
|
|
|
|
2014
|
2013
|
(US$ in thousands,
except per share data)
|
|
|
|
|
|
|
|
Net sales
|
|
41,315
|
35,171
|
Cost of Goods
Sold
|
|
(28,526)
|
(24,254)
|
Gross
Margin
|
|
12,789
|
10,917
|
|
|
|
|
Operating
Expenses
|
|
|
|
Selling and
administrative
|
|
(10,851)
|
(9,570)
|
Operating
income
|
|
1,938
|
1,347
|
|
|
|
|
Interest
Expenses
|
|
(608)
|
(268)
|
Other
Income
|
|
432
|
373
|
Income before income
taxes
|
|
1,762
|
1,452
|
|
|
|
|
Income
taxes
|
|
(245)
|
(310)
|
Net income after
taxes
|
|
1,517
|
1,142
|
|
|
|
|
Other comprehensive
income (loss)
|
|
|
|
Foreign
currency translation adjustment
|
|
16
|
(4)
|
Total comprehensive
income
|
|
1,533
|
1,138
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
-Basic
|
|
US$0.09
|
US$ 0.07
|
|
|
|
|
-Diluted
|
|
US$0.09
|
US$ 0.07
|
|
|
|
|
Weighted average
number of shares
|
|
|
|
|
|
|
|
-Basic
|
|
16,230,541
|
16,187,218
|
|
|
|
|
-Diluted
|
|
16,651,207
|
16,722,062
|
Jinpan
International Limited and Subsidiaries
|
Consolidated
Balance Sheet
|
|
|
|
|
|
(Unaudited)
|
|
(Audited)
|
|
March 31,
2014
|
|
December 31,
2013
|
(In US$ thousands,
except number of shares and per share data)
|
|
|
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
13,836
|
|
24,582
|
Restricted cash
|
856
|
|
1,316
|
Short-term
investment
|
3,901
|
|
4,920
|
Notes receivable
|
13,035
|
|
15,802
|
Accounts receivable,
net
|
140,528
|
|
144,606
|
Inventories, net
|
36,999
|
|
33,614
|
Prepaid expenses
|
6,257
|
|
4,204
|
Land use right
|
377
|
|
377
|
Deferred tax
assets
|
2,243
|
|
2,119
|
Other receivables
|
7,784
|
|
6,891
|
Total current
assets
|
225,816
|
|
238,431
|
|
|
|
|
Property, plant and
equipment, net
|
76,413
|
|
75,601
|
Construction-in-progress
|
1,597
|
|
3,787
|
Land use
right
|
14,679
|
|
14,840
|
Goodwill
|
13,694
|
|
13,818
|
Other
assets
|
87
|
|
90
|
Deferred tax
assets
|
34
|
|
34
|
Total
assets
|
332,320
|
|
346,601
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
Current
liabilities:
|
|
|
|
Short-term bank
loans
|
10,759
|
|
11,101
|
Accounts payable
|
24,857
|
|
27,013
|
Notes Payable
|
5,645
|
|
10,498
|
Income tax
payable
|
2,173
|
|
2,516
|
Advances from
customers
|
13,659
|
|
14,207
|
Other liabilities
|
24,926
|
|
30,339
|
Total current
liabilities
|
82,019
|
|
95,674
|
Commitments and
contingencies
|
|
|
|
Long term
liability:
|
|
|
|
Deferred Income
|
4,737
|
|
4,785
|
Long Term bank
loans
|
32,428
|
|
31,998
|
Total
Liabilities
|
119,184
|
|
132,457
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
Convertible preferred
stock, US$0.0045 par value:
|
|
|
|
Authorized shares -
2,000,000
|
|
|
|
Issued and outstanding
shares – none in 2014 and 2013
|
-
|
|
-
|
Common stock,
US$0.0045 par value:
|
|
|
|
Authorized shares –
40,000,000
|
|
|
|
Issued and
outstanding shares –16,418,456 in 2014 and 2013
|
74
|
|
74
|
Common
stock-warrants
|
-
|
|
-
|
Additional paid-in
capital
|
37,714
|
|
37,693
|
Reserves
|
12,849
|
|
12,849
|
Retained
earnings
|
137,739
|
|
136,874
|
Accumulated other
comprehensive income
|
25,028
|
|
26,937
|
|
213,404
|
|
214,427
|
Less: Treasury shares
at cost,
|
|
|
|
Common stock –135,488
in 2014 and 138,306 in 2013
|
(268)
|
|
(283)
|
Total shareholders'
equity
|
213,136
|
|
214,144
|
Total liabilities and
shareholders' equity
|
332,320
|
|
346,601
|
Jinpan
International Limited and Subsidiaries
|
Consolidated
Statement of Cash Flows
|
For the Three
Months Ended March 31, 2014 (unaudited)
|
|
|
|
For the Three Months
Ended
|
|
March 31
|
|
2014
|
2013
|
(In US$
thousands)
|
|
|
|
|
|
Operating
Activities
|
|
|
Net Income
|
1,517
|
1,142
|
Adjustments to
reconcile net income to
|
|
|
Net Cash provided by (used in) operating activities:
|
|
|
Depreciation
|
1,062
|
1,629
|
Amortization of prepaid lease
|
24
|
92
|
Deferred Income Tax
|
(143)
|
(170)
|
Provision for doubtful debts
|
809
|
562
|
Loss/(gain)
on disposal of fixed assets
|
-
|
-
|
Stock-based compensation Cost
|
20
|
13
|
Changes in operating
assets and liabilities
|
|
|
Restricted Cash
|
450
|
233
|
Accounts
Receivable
|
1,984
|
(523)
|
Notes Receivable
|
2,636
|
4,756
|
Inventories
|
(3,703)
|
(3,372)
|
Prepaid Expenses
|
(2,100)
|
(3,012)
|
Other Receivable
|
(957)
|
(1,363)
|
Accounts Payable
|
(1,923)
|
4,341
|
Notes Payable
|
(4,780)
|
(1,082)
|
Income Tax
|
(321)
|
(47)
|
Advance From customers
|
(422)
|
2,015
|
Other liabilities
|
(5,164)
|
(3,065)
|
Net Cash provided by
(used in) operating activities
|
(11,011)
|
2,149
|
|
|
|
Investing
activities
|
|
|
Purchases of property, plant
and equipment
|
(187)
|
(6,032)
|
Proceeds from sales of
property, plant and equipment
|
-
|
-
|
Payment for construction in
progress
|
(206)
|
(1,128)
|
Sell of short term
investment
|
21,553
|
11,151
|
Purchase of short
term investment
|
(20,573)
|
-
|
Receipt of
government grant for new plant construction
|
-
|
1,109
|
Net Cash provided by
(used in) investing activities
|
587
|
5,100
|
|
|
|
Financing
activities
|
|
|
Proceeds from bank
loan
|
6,158
|
8,125
|
Repayment of bank
loan
|
(5,680)
|
(7,265)
|
Proceeds from exercised
stock option
|
15
|
73
|
Dividend paid
|
(651)
|
(486)
|
Net Cash provided by
(used in) financing activities
|
(158)
|
447
|
|
|
|
Effect of exchange
rate changes on cash
|
(164)
|
54
|
Net
increase/(decrease) in cash and cash equivalents
|
(10,746)
|
7,750
|
Cash and Cash
equivalents at beginning of year
|
24,582
|
18,510
|
Cash and Cash
equivalents at end of year
|
13,836
|
26,260
|
|
|
|
Interest
paid
|
458
|
340
|
Income Tax
paid
|
710
|
193
|
SOURCE Jinpan International Limited