BEIJING, Nov 13, 2017 /PRNewswire/ --
First Quarter of Fiscal Year
2018 Financial Highlights
- Non-GAAP net income attributable to Hollysys was
$21.9 million, a decrease of 3.6%
compared to the comparable prior year period.
- Total revenues were $115.5
million, an increase of 11.6% compared to the comparable
prior year period.
- Non-GAAP gross margin was at 36.6%, compared to 29.6%
for the comparable prior year period.
- Non-GAAP diluted EPS were at $0.36, a decrease of 5.3% compared to the
comparable prior year period.
- Net cash provided by operating activities was
$36.1 million for the current
quarter.
- DSO of 196 days, compared to 207 days for the comparable
prior year period.
- Inventory turnover days of 61 days, compared to 48 days
for the comparable prior year period.
Hollysys Automation Technologies
Ltd. (NASDAQ: HOLI) ("Hollysys" or the "Company"), a leading
provider of automation and control technologies and applications in
China, today announced its
unaudited financial results for the fiscal year 2018 first quarter
ended September 30, 2017 (see
attached tables). The management of Hollysys, stated:
The momentum of recovery in industrial automation continued in
this quarter as we recorded 27.6% and 18.9% year-on-year growth in
revenue and new contract respectively, with revenue achieving
year-on-year growth for three consecutive quarters. Our performance
in power industry remained stable and dominant as we signed
contracts on Datang Dongying 2X1000MW power units and Guohua
Yongzhou 2X1000MW power units, etc. In chemical, we signed several
major contracts, including a DCS contract with Inner Mongolia
FuFeng Group on Biology ingredients workshop project and a contract
with Zhonganlianhe Coal-chemical Company on 1.7 million ton methyl
alcohol and olefin conversion project. In food beverage area, we
signed a contract with Xinjiang Kashi Aodu Sugar Industry on 20
million tons/year Beet Sugar DCS project. In nuclear, we continued
to provide products for Tianwan #5 and #6 units.
In factory automation, we kept focusing on several key
industries and renowned players and our
demonstration-for-further-application approach has been going
smoothly. As we perform these projects, we improve our capability
of providing turnkey solutions, accumulate track records and raise
brand awareness. In white-goods area, our cooperation with Haier
went further as we won new contracts on their Tianjin-based and Qingdao-based washing machine factories.
Additionally, breakthrough was achieved in new energy area, as we
won contracts from Do-Fluoride Chemicals Co., Ltd. to help improve
the interconnection, data collection and management of production
equipment in their lithium battery workshop. We believe that these
projects will lead to more business opportunities from the current
and an increasingly wider customer base.
In high speed rail, we signed contract to provide TCC to
Longchuan-Shanwei Railway. Our short term performance can be
affected by factors such as limited completion of newly planned
railway infrastructure in the early years of the 13th
five-year-plan and the change in customer procurement timeline.
However, we believe that outlook for rail business in the long run
remains positive, given an explicit national plan, growing
after-sale service demand and launching of our new products. For
subway, we adhered to the expansion strategy to win new SCADA
contracts in more cities and work closely with subway authorities
to promote our SCADA system and subway signaling technologies in
future.
In mechanical and electrical installation services, with
macroeconomic and political circumstances in South East Asia and Middle East being closely followed, Concord
and Bond remained active in exploration and kept executing projects
covering various industries. Management and risk control have also
been addressed to improve operation efficiency. The strategic value
of Concord and Bond as customer resources and international sales
channels remains significant and we expect a moderate growth in the
future.
The Quarter Ended September 30, 2017 Unaudited Financial
Results Summary
To facilitate a clear understanding of Hollysys' operational
results, a summary of unaudited non-GAAP financial results is shown
as below:
|
|
|
|
|
Three months
ended
|
|
|
Sep 30,
2017
|
Sep 30,
2016
|
%
Change
|
|
|
|
|
|
Revenues
|
$
|
115,510
|
103,543
|
11.6%
|
Integrated
contract revenue
|
$
|
95,690
|
93,066
|
2.8%
|
Products
sales
|
$
|
9,460
|
8,313
|
13.8%
|
Service
rendered
|
$
|
10,360
|
2,164
|
378.7%
|
Cost of
revenues
|
$
|
73,238
|
72,885
|
0.5%
|
Gross
profit
|
$
|
42,272
|
30,658
|
37.9%
|
Total operating
expenses
|
$
|
19,205
|
13,309
|
44.3%
|
Selling
|
$
|
6,698
|
5,552
|
20.6%
|
General and
administrative
|
$
|
10,957
|
9,675
|
13.3%
|
Research and
development
|
$
|
8,631
|
7,697
|
12.1%
|
VAT refunds and
government subsidies
|
$
|
(7,081)
|
(9,615)
|
(26.4)%
|
Income from
operations
|
$
|
23,067
|
17,350
|
33.0%
|
Other income,
net
|
$
|
439
|
394
|
11.4%
|
Foreign exchange
loss
|
$
|
(1,228)
|
(9)
|
13544.4%
|
Share of net income
of equity investees
|
$
|
935
|
1,309
|
(28.6)%
|
Gains on dilution and
divestment of the Company's interests in HollyCon
|
$
|
-
|
6,093
|
(100.0)%
|
Dividend income from
a cost investee
|
$
|
1,152
|
-
|
-
|
Interest
income
|
$
|
1,476
|
745
|
98.1%
|
Interest
expenses
|
$
|
(137)
|
(129)
|
6.2%
|
Income tax
expenses
|
$
|
3,736
|
3,011
|
24.1%
|
Net income (loss)
attributable to noncontrolling interests
|
$
|
33
|
(4)
|
(925.0)%
|
Non-GAAP net income
attributable to Hollysys Automation Technologies Ltd.
|
$
|
21,935
|
22,745
|
(3.6)%
|
Non-GAAP basic
EPS
|
$
|
0.36
|
0.38
|
(5.3)%
|
Non-GAAP diluted
EPS
|
$
|
0.36
|
0.38
|
(5.3)%
|
|
|
|
|
|
Share-based
compensation expenses
|
$
|
392
|
918
|
(57.3)%
|
Amortization of
acquired intangible assets
|
$
|
179
|
140
|
27.0%
|
GAAP Net income
attributable to Hollysys Automation Technologies Ltd.
|
$
|
21,364
|
21,687
|
(1.5)%
|
GAAP basic
EPS
|
$
|
0.35
|
0.36
|
(2.8)%
|
GAAP diluted
EPS
|
$
|
0.35
|
0.36
|
(2.8)%
|
|
|
|
|
|
Basic weighted
average common shares outstanding
|
|
60,425,631
|
60,068,894
|
0.6%
|
Diluted weighted
average common shares outstanding
|
|
61,261,417
|
61,114,540
|
0.2%
|
Operational Results Analysis for the Quarter Ended
September 30, 2017
Comparing to the first quarter of the prior fiscal year, the
total revenues for the three months ended September 30, 2017 increased from $103.5 million to $115.5
million, representing an increase of 11.6%. Broken down by
the revenue types, services revenue increased by 378.7% to
$10.4 million, products sales revenue
increased by 13.8% to $9.5 million,
and integrated contracts revenue increased by 2.8% to $95.6million.
The Company's total revenues can also be presented in
segments as shown in the following chart:
(In USD
thousands)
|
|
|
|
|
|
|
|
|
Three months
ended Sep 30,
|
|
|
2017
|
|
2016
|
|
|
$
|
% to Total
Revenue
|
|
$
|
% to Total
Revenue
|
Industrial
Automation
|
|
57,481
|
49.7%
|
|
45,041
|
43.5%
|
Rail Transportation
Automation
|
|
35,197
|
30.5%
|
|
33,033
|
31.9%
|
Mechanical and
Electrical Solution
|
22,832
|
19.8%
|
|
25,469
|
24.6%
|
Total
|
|
115,510
|
100.0%
|
|
103,543
|
100.0%
|
Overall gross margin excluding non-cash
amortization of acquired intangibles (non-GAAP gross
margin) was 36.6% for the three months ended September 30, 2017, as compared to 29.6% for the
same period of the prior year. The non-GAAP gross
margin for integrated contracts, product sales, and services
rendered were 29.3%, 71.8% and 71.6% for the three months ended
September 30, 2017, as compared to
25.0%, 70.5%, and 69.7% for the same period of the prior year
respectively. The gross margin fluctuation was mainly due to the
different revenue mix with different margin. The GAAP
overall gross margin which includes non-cash amortization of
acquired intangibles was 36.4% for the three months ended
September 30, 2017, as compared to
29.5% for the same period of the prior year. The GAAP
gross margin for integrated contracts, product sales, and
service rendered were 29.1%, 71.8% and 71.6% for the three
months ended September 30, 2017, as
compared to 24.9%, 70.5%, and 69.7% for the same period of the
prior year respectively.
Selling expenses were $6.7
million for the three months ended September, 2017,
representing an increase of $1.1
million or 20.6% compared to $5.6
million for the same period of the prior year, mainly due to
increased sales activities. Presented as a percentage of total
revenues, selling expenses were 5.8% and 5.4% for the three months
ended September 30, 2017, and 2016,
respectively.
General and
administrative expenses, excluding non-cash
share-based compensation expenses (non-GAAP G&A expenses),
were $11.0 million for the three
months ended September 30, 2017,
representing an increase of $1.3
million, or 13.3%, as compared to $9.7 million for the same period of the prior
year, mainly due to an increase of $2.1
million in allowance for doubtful accounts. Presented as a
percentage of total revenues, non-GAAP G&A expenses were 9.5%
and 9.3% for the quarters ended September
30, 2017 and 2016 respectively. The GAAP G&A
expenses which include the non-cash share-based compensation
expenses were $11.3 million and
$10.6 million for the three months
ended September 30, 2017 and 2016,
respectively.
Research and development expenses were $8.6 million for the three months ended
September 30, 2017, an increase of
$0.9 million or 11.7% compared to
$7.7 million for the same period of
the prior year, mainly due to increased research and development
activities. Presented as a percentage of total revenues, R&D
expenses were 7.5% and 7.4% for the quarter ended September 30, 2017 and 2016, respectively.
The VAT refunds and government subsidies were
$7.1 million for the three months
ended September 30, 2017, as compared
to $9.6 million for the same period
of the prior year, representing a $2.5
million or 26.0% decrease which was primarily due to
decrease of the government subsidies for $3.0 million.
The income tax expenses and the effective tax rate were
$3.7 million and 14.9% for the three
months ended September 30, 2017, as
compared to $3.0 million and 12.2%
for the same period of the prior year.
The non-GAAP net income attributable to Hollysys, which
excludes non-cash share-based compensation expenses, amortization
of acquired intangibles, acquisition-related consideration fair
value adjustments and convertible bond related fair value
adjustments was $21.9 million or
$0.36 per diluted share based on 61.3
million shares outstanding for the three months ended September 30, 2017. This represents a 3.6%
decrease over the $22.7 million or
$0.38 per share based on 61.1 million
shares outstanding reported in the comparable prior year period.
On a GAAP basis, net income attributable to Hollysys was
$21.4 million or $0.35 per diluted share representing a decrease
1.5% over the $21.7 million or
$0.36 per diluted share reported in
the comparable prior year period. In July
2016, the company's interests in HollyCon were diluted from
51.0% to 30.0%, the Company recorded a gains on dilution and
divestment of the Company's interests in HollyCon of $6.1 million during the first quarter of fiscal
year 2017. Excluding the impact of the above mentioned for the same
period of the prior year, the non-GAAP net income attributable to
Hollysys for the three months ended September 30, 2017 should be increased by 31.7%,
the GAAP net income to Hollysys for the three months ended
September 30, 2017 should be
increased by 37.0%.
Contracts and Backlog Highlights
Hollysys achieved $91.6 million
new contracts for the three months ended September 30, 2017. And the backlog as of
September 30, 2017 was $498.3 million. The detailed breakdown of the new
contracts and backlog by segments is shown below:
(In USD
thousands)
|
|
New contracts
achieved
|
|
Backlog
|
|
|
for the three
months
ended Sep
30, 2017
|
|
as of Sep 30,
2017
|
|
|
$
|
% to Total
Contract
|
|
$
|
% to Total
Backlog
|
Industrial
Automation
|
|
73,051
|
79.7%
|
|
168,245
|
33.8%
|
Rail
Transportation
|
|
7,405
|
8.1%
|
|
210,888
|
42.3%
|
Mechanical and
Electrical Solutions
|
|
11,182
|
12.2%
|
|
119,138
|
23.9%
|
Total
|
|
91,638
|
100.0%
|
|
498,271
|
100.0%
|
Cash Flow Highlights
For the three months ended September 30,
2017, the total net cash inflow was $47.2 million. The net cash provided by
operating activities was $36.1
million. The net cash provided by investing
activities was $6.6 million,
mainly consisted of $38.4 million
maturity of time deposits, which was partially offset by
$27.1 million deposits placed with
banks. The net cash provided by financing activities was
$1.0 million.
Balance Sheet Highlights
The total amount of cash and cash equivalents and time
deposits with original maturities over three months were
$331.5 million, $293.9 million, and $260.8
million as of September 30,
2017, June 30, 2017 and
September 30, 2016, respectively. As
of September 30, 2017, the company
held $244.8 million in cash and cash
equivalents and $86.7 million in time
deposits with original maturities over three months.
For the three months ended September 30,
2017, DSO was 196 days, as compared to 207 days for the
comparable prior year period and 153 days for the last quarter; and
inventory turnover was 61 days, as compared to 48 days for the
comparable prior year period and 51 days for the last quarter.
Outlook for FY 2018
The management concluded, "Based on our backlog currently
on-hand and sales pipeline envisioned so far, we set our guidance
for fiscal year 2018 with revenue in the range of $500 million to $530 million and non-GAAP net
income in the range of $100 million to $110
million."
Conference Call
The Company will host a conference call at 8:00 pm November 13,
2017 U.S. Eastern Time / 9:00
am November 14, 2017 Beijing
Time, to discuss the financial results for the first quarter of
fiscal year 2018 ended September 30,
2017 and business outlook.
To participate, please call the following numbers ten minutes
before the scheduled start of the call. The conference call
identification number is 6000014.
1 800 573
793
|
(Australia)
|
+61 (0)2 9193
3706
|
(Australia,
Sydney)
|
4001 209
101
|
(China)
|
0805 101
219
|
(France)
|
0800 589
4609
|
(Germany)
|
800 961
105
|
(Hong
Kong)
|
+852 3008
1527
|
(Hong
Kong)
|
0120 001
836
|
(Japan)
|
007 9814 2032
546
|
(Korea, Republic
of)
|
1800 806
802
|
(Malaysia)
|
+65 6320
9025
|
(Singapore,
Singapore)
|
0800 200
831
|
(Switzerland)
|
0800 868
298
|
(Taiwan)
|
0800 358
6377
|
(United
Kingdom)
|
+44 (0)330 336
9105
|
(United Kingdom,
Local)
|
800 239
9838
|
(United
States/Canada)
|
+1 323 794
2551
|
(United States, Los
Angeles)
|
In addition, a recording of the conference call will be
accessible within 48 hours via Hollysys' website at:
http://ir.hollysys.com/ or http://hollysys.investorroom.com
About Hollysys Automation Technologies Ltd. (NASDAQ:
HOLI)
Hollysys Automation Technologies is a leading provider of
automation and control technologies and applications in
China that enables its diversified
industry and utility customers to improve operating safety,
reliability, and efficiency. Founded in 1993, Hollysys has
approximately 3,200 employees with nationwide presence in over 60
cities in China, with subsidiaries
and offices in Singapore,
Malaysia, Dubai, India,
and serves over 10,000 customers more than 25,000 projects in the
industrial, railway, subway & nuclear industries in
China, South-East Asia, and the Middle East. Its proprietary technologies are
applied in its industrial automation solution suite including DCS
(Distributed Control System), PLC (Programmable Logic Controller),
RMIS (Real-time Management Information System), HAMS (HolliAS Asset
Management System), OTS (Operator Training System), HolliAS BATCH
(Batch Application Package), HolliAS APC Suite (Advanced Process
Control Package), SIS (Safety Instrumentation System), high-speed
railway signaling system of TCC (Train Control Center), ATP
(Automatic Train Protection), Subway Supervisory and Control
platform, SCADA (Supervisory Control and Data Acquisition), nuclear
power plant automation and control system and other products.
SAFE HARBOUR:
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
All statements, other than statements of historical fact included
herein are "forward-looking statements," including statements
regarding: the ability of the Company to achieve its commercial
objectives; the business strategy, plans and objectives of the
Company and its subsidiaries; and any other statements of
non-historical information. These forward-looking statements are
often identified by the use of forward-looking terminology such as
"believes," \"expects" or similar expressions, involve known and
unknown risks and uncertainties. Such forward-looking statements,
based upon the current beliefs and expectations of Hollysys'
management, are subject to risks and uncertainties, which could
cause actual results to differ from the forward looking statements.
Although the Company believes that the expectations reflected in
these forward-looking statements are reasonable, they do involve
assumptions, risks and uncertainties, and these expectations may
prove to be incorrect. Investors should not place undue reliance on
these forward-looking statements, which speak only as of the date
of this press release. The Company's actual results could differ
materially from those anticipated in these forward-looking
statements as a result of a variety of factors, including those
discussed in the Company's reports that are filed with the
Securities and Exchange Commission and available on its website
(http://www.sec.gov). All forward-looking statements attributable
to the Company or persons acting on its behalf are expressly
qualified in their entirety by these factors. Other than as
required under the securities laws, the Company does not assume a
duty to update these forward-looking statements.
For further information, please contact:
Hollysys Automation Technologies Ltd.
www.hollysys.com
+8610-58981386
investors@hollysys.com
|
|
|
|
|
|
|
Three months
ended
Sep 30,
|
|
|
|
2017
|
|
2016
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
Net
revenues
|
|
|
|
|
|
Integrated contract
revenue
|
$
|
95,690
|
$
|
93,066
|
|
Products
sales
|
|
9,460
|
|
8,313
|
|
Revenue from
services
|
|
10,360
|
|
2,164
|
|
Total net
revenues
|
|
115,510
|
|
103,543
|
|
|
|
|
|
|
|
Cost of integrated
contracts
|
|
67,812
|
|
69,914
|
|
Cost of products
sold
|
|
2,667
|
|
2,456
|
|
Costs of services
rendered
|
|
2,938
|
|
655
|
|
Gross
profit
|
|
42,093
|
|
30,518
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
Selling
|
|
6,698
|
|
5,552
|
|
General and
administrative
|
|
11,349
|
|
10,593
|
|
Research and
development
|
|
8,631
|
|
7,697
|
|
VAT refunds and
government subsidies
|
|
(7,081)
|
|
(9,615)
|
|
Total operating
expenses
|
|
19,597
|
|
14,227
|
|
|
|
|
|
|
|
Income from
operations
|
|
22,496
|
|
16,291
|
|
|
|
|
|
|
|
Other income,
net
|
|
439
|
|
394
|
|
Foreign exchange
loss
|
|
(1,228)
|
|
(9)
|
|
Share of net income
of equity investees
|
|
935
|
|
1,309
|
|
Gains on dilution and
divestment of the Company's interests in HollyCon
|
-
|
|
6,093
|
|
Dividend income from
a cost investee
|
|
1,152
|
|
-
|
|
Interest
income
|
|
1,476
|
|
745
|
|
Interest
expenses
|
|
(137)
|
|
(129)
|
|
Income before
income taxes
|
|
25,133
|
|
24,694
|
|
|
|
|
|
|
|
Income taxes
expenses
|
|
3,736
|
|
3,011
|
|
Net
income
|
|
21,397
|
|
21,683
|
|
|
|
|
|
|
|
Net income (loss)
attributable to noncontrolling interests
|
33
|
|
(4)
|
|
Net income
attributable to Hollysys Automation Technologies
Ltd.
|
$
|
21,364
|
$
|
21,687
|
|
|
|
|
|
|
|
Other
comprehensive income (loss), net of tax of nil
|
|
|
|
|
Translation
adjustments
|
|
14,758
|
|
(12,426)
|
|
Comprehensive
income
|
|
36,155
|
|
9,257
|
|
|
|
|
|
|
|
Less: comprehensive
income (loss) attributable to noncontrolling interests
|
34
|
|
(8,507)
|
|
Comprehensive
income attributable to Hollysys Automation Technologies
Ltd.
|
$
|
36,121
|
$
|
17,764
|
|
|
|
|
|
|
|
Net income per
ordinary share:
|
|
|
|
|
|
Basic
|
|
0.35
|
|
0.36
|
|
Diluted
|
|
0.35
|
|
0.36
|
|
Shares used in
income per share computation:
|
|
|
|
|
|
Weighted average
number of ordinary shares
|
60,425,631
|
|
60,068,894
|
|
Weighted average
number of diluted ordinary shares
|
61,261,417
|
|
61,114,540
|
|
|
|
|
|
|
|
|
|
|
|
HOLLYSYS
AUTOMATION TECHNOLOGIES LTD.
CONSOLIDATED BALANCE SHEETS
|
(In USD thousands
except for number of shares and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Sep
30,
|
|
Jun
30,
|
|
|
|
|
2017
|
|
2017
|
|
|
|
|
(Unaudited)
|
|
(Audited)
|
ASSETS
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
244,838
|
$
|
197,640
|
|
|
Time deposits with
original maturities over three months
|
|
86,628
|
|
96,214
|
|
|
Restricted
cash
|
|
28,192
|
|
39,534
|
|
|
Accounts receivable,
net of allowance for doubtful accounts of $48,709 and $48,089 as of
September 30,2017 and June 30, 2017, respectively
|
|
255,359
|
|
246,552
|
|
|
Costs and estimated
earnings in excess of billings, net of allowance for doubtful
accounts of $10,788 and $8,659 as of September 30, 2017 and June
30, 2017, respectively
|
|
169,495
|
|
162,096
|
|
|
Other receivables,
net of allowance for doubtful accounts of $1,454 and $1,448 as of
September 30, 2017 and June 30, 2017, respectively
|
|
15,713
|
|
20,036
|
|
|
Advances to
suppliers
|
|
14,108
|
|
9,964
|
|
|
Amounts due from
related parties
|
|
31,341
|
|
34,142
|
|
|
Inventories
|
|
50,112
|
|
45,660
|
|
|
Prepaid
expenses
|
|
548
|
|
619
|
|
|
Income tax
recoverable
|
|
5,704
|
|
5,169
|
|
|
Deferred tax
assets
|
|
8,085
|
|
7,730
|
|
Total current
assets
|
|
910,123
|
|
865,356
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
Restricted
cash
|
|
533
|
|
522
|
|
|
Prepaid
expenses
|
|
1
|
|
-
|
|
|
Property, plant and
equipment, net
|
|
81,705
|
|
80,529
|
|
|
Prepaid land
leases
|
|
10,321
|
|
10,206
|
|
|
Acquired intangible
assets, net
|
|
3,895
|
|
1,928
|
|
|
Investments in equity
investees
|
|
49,138
|
|
47,242
|
|
|
Investments in cost
investees
|
|
4,105
|
|
4,024
|
|
|
Goodwill
|
|
47,984
|
|
47,326
|
|
|
Deferred tax
assets
|
|
1,333
|
|
1,121
|
|
Total non-current
assets
|
|
199,015
|
|
192,898
|
|
|
|
|
|
|
|
Total
assets
|
|
1,109,138
|
|
1,058,254
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
Derivative financial
liability
|
|
487
|
|
487
|
|
|
Short-term bank
loans
|
|
8,929
|
|
8,121
|
|
|
Current portion of
long-term loans
|
|
393
|
|
420
|
|
|
Dividends
payable
|
|
7,241
|
|
-
|
|
|
Accounts
payable
|
|
116,998
|
|
122,714
|
|
|
Construction cost
payable
|
|
213
|
|
383
|
|
|
Deferred
revenue
|
|
120,570
|
|
107,407
|
|
|
Accrued payroll and
related expenses
|
|
15,458
|
|
13,600
|
|
|
Income tax
payable
|
|
3,548
|
|
3,371
|
|
|
Warranty
liabilities
|
|
5,511
|
|
5,386
|
|
|
Other tax
payables
|
|
9,646
|
|
10,488
|
|
|
Accrued
liabilities
|
|
26,595
|
|
23,950
|
|
|
Amounts due to
related parties
|
|
3,440
|
|
2,301
|
|
|
Deferred tax
liabilities
|
|
3,642
|
|
4,350
|
|
Total current
liabilities
|
|
322,671
|
|
302,978
|
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
|
Accrued
liabilities
|
|
3,955
|
|
2,220
|
|
|
Long-term
loans
|
|
20,786
|
|
20,581
|
|
|
Deferred tax
liabilities
|
|
6,674
|
|
6,689
|
|
|
Warranty
liabilities
|
|
2,207
|
|
2,246
|
|
Total non-current
liabilities
|
|
33,622
|
|
31,736
|
|
|
|
|
|
|
|
Total
liabilities
|
|
356,293
|
|
334,714
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
Ordinary shares, par
value $0.001 per share, 100,000,000 shares authorized; 60,342,099
and 60,342,099 shares issued and outstanding as of September 30,
2017 and June 30, 2017, respectively
|
|
60
|
|
60
|
|
|
Additional paid-in
capital
|
|
222,581
|
|
222,189
|
|
|
Statutory
reserves
|
|
41,131
|
|
41,130
|
|
|
Retained
earnings
|
|
497,120
|
|
482,999
|
|
|
Accumulated other
comprehensive income
|
|
(8,102)
|
|
(22,859)
|
|
Total Hollysys
Automation Technologies Ltd. stockholder's equity
|
|
752,790
|
|
723,519
|
|
|
|
|
|
|
|
|
|
Noncontrolling
interests
|
|
55
|
|
21
|
|
Total
equity
|
|
752,845
|
|
723,540
|
|
|
|
|
|
|
|
|
Total liabilities
and equity
|
$
|
1,109,138
|
$
|
1,058,254
|
|
|
|
Three months
ended
|
Sep 30,
2017
|
|
|
|
(Unaudited)
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
|
21,397
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation of
property, plant and equipment
|
|
2,668
|
|
Amortization of
prepaid land leases
|
|
67
|
|
Amortization of
intangible assets
|
|
244
|
|
Allowance for
doubtful accounts
|
|
3,313
|
|
Share of net income
of equity investees
|
|
(935)
|
|
Dividend income from
a cost investee
|
|
(1,152)
|
|
Share based
compensation expenses
|
|
392
|
|
Deferred income tax
benefit
|
|
(1,138)
|
|
Accretion of
convertible bond
|
|
57
|
Changes in
operating assets and liabilities:
|
|
|
|
Accounts
receivable
|
|
(4,262)
|
|
Costs and estimated
earnings in excess of billings
|
|
(6,227)
|
|
Inventories
|
|
(3,500)
|
|
Advances to
suppliers
|
|
(1,970)
|
|
Other
receivables
|
|
4,715
|
|
Deposits and other
assets
|
|
12,080
|
|
Due from related
parties
|
|
4,570
|
|
Accounts
payable
|
|
(5,884)
|
|
Deferred
revenue
|
|
10,996
|
|
Accruals and other
payable
|
|
926
|
|
Due to related
parties
|
|
1,082
|
|
Income tax
payable
|
|
(316)
|
|
Other tax
payables
|
|
(1,042)
|
|
Net cash provided
by operating activities
|
|
36,081
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Time deposits placed
with banks
|
|
(27,092)
|
|
Purchases of
property, plant and equipment
|
|
(102)
|
|
Proceeds from
disposal of property, plant and equipment
|
|
30
|
|
Maturity of time
deposits
|
|
38,409
|
|
Investment of an
equity investee
|
|
(4,061)
|
|
Acquisition of a
subsidiary, net of cash acquired
|
|
(583)
|
|
Net cash provided
by investing activities
|
|
6,601
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
Proceeds from
short-term bank loans
|
|
1,808
|
|
Repayments of
short-term bank loans
|
|
(1,121)
|
|
Proceeds from
long-term bank loans
|
|
334
|
|
Repayments of
long-term bank loans
|
|
(229)
|
|
Net cash provided
by financing activities
|
|
792
|
|
|
|
|
|
Effect of foreign
exchange rate changes
|
|
3,724
|
|
Net increase in
cash and cash equivalents
|
$
|
47,198
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
$
|
197,640
|
|
Cash and cash
equivalents, end of period
|
|
244,838
|
Non-GAAP Measures
In evaluating our results, the non-GAAP measures of "Non-GAAP
general and administrative expenses", "Non-GAAP net income
attributable to Hollysys Automation Technologies Ltd.
stockholders", "Non-GAAP basic earnings per share", and "Non-GAAP
diluted earnings per share" serve as additional indicators of our
operating performance and not as a replacement for other measures
in accordance with U.S. GAAP. We believe these non-GAAP measures
are useful to investors, as they exclude the non-cash share-based
compensation expenses, which is calculated based on the number of
shares or options granted and the fair value as of the grant date,
amortization of acquired intangible assets, fair value adjustments
of acquisition-related consideration, and fair value adjustments of
a bifurcated derivative. They will not result in any cash inflows
or outflows. We believe that using non-GAAP measures help our
shareholders to have a better understanding of our operating
results and growth prospects. In addition, given the business
nature of the Company, it has been a common practice for investors
to use such non-GAAP measures to evaluate the Company.
The following table provides a reconciliation of U.S. GAAP
measures to the non-GAAP measures for the periods indicated:
|
|
|
Three months
ended
|
|
|
|
Sep
30,
|
|
|
|
2017
|
|
2016
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
Cost of integrated
contracts
|
$
|
67,812
|
$
|
69,914
|
Less: Amortization of
acquired intangible assets
|
|
179
|
|
140
|
Non-GAAP cost of
integrated contracts
|
$
|
67,633
|
$
|
69,774
|
|
|
|
|
|
|
General and
administrative expenses
|
$
|
11,349
|
$
|
10,593
|
Less: Share-based
compensation expenses
|
|
392
|
|
918
|
Non-GAAP general
and administrative expenses
|
$
|
10,957
|
$
|
9,675
|
|
|
|
|
|
Net income
attributable to Hollysys Automation Technologies
Ltd.
|
$
|
21,364
|
$
|
21,687
|
Add:
|
|
|
|
|
|
Share-based
compensation expenses
|
|
392
|
|
918
|
|
Amortization of
acquired intangible assets
|
|
179
|
|
140
|
Non-GAAP net
income attributable to Hollysys Automation Technologies
Ltd.
|
$
|
21,935
|
$
|
22,745
|
|
|
|
|
|
|
|
Weighted average
number of basic ordinary shares
|
60,425,631
|
|
60,068,894
|
|
Weighted average
number of diluted ordinary shares
|
61,261,417
|
|
61,114,540
|
Non-GAAP basic
earnings per share
|
$
|
0.36
|
$
|
0.38
|
Non-GAAP diluted
earnings per share
|
$
|
0.36
|
$
|
0.36
|
|
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/hollysys-automation-technologies-reports-unaudited-financial-results-for-the-first-quarter-ended-september-30-2017-300554679.html
SOURCE Hollysys Automation Technologies, Ltd