Highway Holdings Limited (Nasdaq: HIHO) today reported
results for its fiscal 2021 first quarter ended June 30, 2020.
Net loss for the fiscal first quarter was $223,000, or $0.06 per
share, compared with net loss of $102,000, or $0.03 per share, last
year. Net sales for the same period were $2.1 million compared with
$2.8 million a year earlier.
"The company’s financial results were negatively affected by the
COVID-19 pandemic and the temporary closure of operations during
the quarter at its Myanmar factory. The effects of the
COVID-19-related closure were exacerbated because workers at the
Myanmar factory could not return to work from year-end national
holidays due to the impact of the pandemic on transportation, which
essentially shut down operations for the month of April and
impacted the month of May. These factors contributed to
substantially lower sales volume in April and May. Both of our
factories are now in full operation and we are encouraged by
business trends,” said Roland Kohl, chairman, president and chief
executive officer.
Gross profit for the 2021 fiscal first quarter was $520,000
compared with $746,000 in the same period a year ago, with gross
profit as a percentage of sales approximately 25 percent compared
with 26 percent a year ago.
Selling, general and administrative expense for the 2021 fiscal
first quarter decreased by $182,000 – benefiting from sharp
cost-cutting initiatives. As a percentage of net sales, SG&A
expenses increased to 35 percent from 32 percent due to the sharp
sales decrease for the quarter.
The company realized a currency exchange loss of $20,000 in the
quarter compared with an exchange gain of $41,000 in the same
period last year, primarily due to weakness in the RMB during the
period.
Kohl highlighted the company’s solid financial position, with
cash and cash equivalents of $ 9.1 million -- exceeding combined
short- and long-term liabilities by $2.9 million. At June 30, 2020,
the company had working capital of $8 million.
Total shareholders’ equity at June 30, 2020 was $10.7 million
compared with $10.9 million as of March 31, 2020. The company’s
current ratio at June 30, 2020 was 2.9 :1.
About Highway Holdings
Highway Holdings is an international manufacturer of a wide
variety of high-quality parts and products for blue chip equipment
manufacturers based primarily in Germany. Highway Holdings’
administrative offices are located in Hong Kong and its
manufacturing facilities are located in Yangon, Myanmar and
Shenzhen, China.
Except for the historical information contained herein, the
matters discussed in this press release, including all statements
about operations in Yangon, Myanmar, the impact of the COVID-19
pandemic on the company’s longer-term business outlook, and the
prospects of establishing longer-term relationships with new
customers, are forward-looking statements which involve risks and
uncertainties, including but not limited to economic, competitive,
governmental, political and technological factors affecting the
company's revenues, operations, markets, products and prices, and
other factors discussed in the company’s various filings with the
Securities and Exchange Commission, including without limitation,
the company’s annual reports on Form 20-F.
HIGHWAY HOLDINGS LIMITED AND
SUBSIDIARIES
Consolidated Statement of
Income
(Dollars in thousands, except per
share data)
(Unaudited)
Quarter Ended
June 30
2020
2019
Net sales
$
2,057
$
2,845
Cost of sales
1,537
2,099
Gross profit
520
746
Selling, general and administrative
expenses
730
912
Operating (loss) / income
(210
)
(166
)
Non-operating income (expense):
Exchange gain (loss), net
(20
)
41
Interest income
4
10
Gain/(loss) on disposal of asset
1
1
Other income (expense)
1
1
Total non-operating income (expenses)
(14
)
53
Net (loss)/income before income taxes
(224
)
(113
)
Income taxes
-
-
Net (loss)/ income
(224
)
(113
)
Less: net gain/(loss) attributable to
non-controlling interests
(1
)
(11
)
Net (loss)/income attributable to Highway
Holdings Limited’s
Shareholders
($
223
)
($
102
)
Net (loss)/income per share – Basic and
Diluted
($
0.06
)
($
0.03
)
Weighted average number of shares
outstanding:
Basic
3,910
3,802
Diluted
3,910
3,802
HIGHWAY HOLDINGS LIMITED AND
SUBSIDIARIES
Consolidated Balance Sheet
(In thousands, except per share
data)
June 30
March 31
2020
2020
Current
assets:
Cash and cash equivalents
$
9,099
$
8,827
Accounts receivable, net of doubtful
accounts
1,119
2,008
Inventories
1,765
2,000
Prepaid expenses and other current
assets
221
388
Total current assets
12,204
13,223
Property, plant and equipment, net
891
878
Operating lease right-of-use assets
3,497
3,710
Long-term deposits
263
263
Long-term loan receivable
95
95
Investments in equity method investees
-
-
Total assets
16,950
18,169
Current
liabilities:
Accounts payable
$
749
$
997
Operating lease liabilities, current
806
782
Accrued expenses and other liabilities
2,066
2,294
Income tax payable
571
564
Dividend payable
2
351
Total current liabilities
4,194
4,988
Operating lease liabilities,
non-current
1,823
2,034
Deferred income taxes
229
229
Total liabilities
6,246
7,251
Shareholders'
equity:
Preferred shares, $0.01 par value
-
-
Common shares, $0.01 par value
40
40
Additional paid-in capital
11,552
11,537
Accumulated deficit
(1,089
)
(865
)
Accumulated other comprehensive
income/(loss)
190
196
Treasury shares, at cost – Nil shares as
of June 30, 2020; and on March 31, 2020
-
-
Non-controlling interest
11
10
Total shareholders' equity
10,704
10,918
Total liabilities and shareholders'
equity
$
16,950
$
18,169
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200831005203/en/
Gary S. Maier Maier & Company, Inc. (310) 471-1288
Highway (NASDAQ:HIHO)
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