omniture

Midas Reports Net Profit of RMB14.9 Million for 2Q2013

2013-08-15 02:31 3303

SINGAPORE and HONG KONG, Aug. 15, 2013 /PRNewswire/ --

  • Revenue up 29.2% to RMB284.0 million on higher contributions from the Aluminium Alloy Extruded Products Division
  • Proposes interim dividend of 0.25 Singapore cent per ordinary share

Financial Highlights

(RMB' mil) 2Q2013  2Q2012  Change %  1H2013  1H2012  Change % 
Revenue 284.0  219.8 29.2 486.4  450.2 8.0
Gross profit 63.8  69.3 (7.9) 114.9  137.1 (16.2)
Share of profits/ (losses) from associate 3.1  (14.1) N.M.* (0.9)  (18.7) (95.2)
Profit before tax 19.5  8.4 133.0 15.2  28.4 (46.3)
Profit attributable to equity holders 14.9  1.6 834.1 10.0  16.9 (40.8)

* Not Meaningful

Midas Holdings Limited ("Midas" or the "Company," together with its subsidiaries, the "Group"; SGX-ST stock code: 5EN; SEHK stock code: 1021) reported net profit attributable to equity holders (“Net Profit”) of RMB14.9 million for the three months ended June 30, 2013 (“2Q2013”), from RMB1.6 million for the corresponding financial period ("2Q2012").

Group revenue rose 29.2% from RMB219.8 million for 2Q2012 to RMB284.0 million for 2Q2013. The Group's Aluminium Alloy Extruded Products Division recorded a 29.8% increase for its 2Q2013 revenue to RMB272.7 million, accounting for approximately 96.0% of total revenue.

Within the division, the Transport Industry is the largest revenue contributor, accounting for 66.7% of its revenue in 2Q2013 which also included the supply of aluminium alloy extrusion profiles for freight wagons. The "Others" segment, which included mainly the supply of aluminium alloy rods and other specialised profiles for industrial machinery, contributed 24.6% of revenue to the Aluminium Alloy Division. Revenue contribution from the Power Industry accounted for the remaining 8.7%.

The Group's overall gross profit margin was 22.5% for 2Q2013, compared to 31.5% for 2Q2012. The decrease was mainly due to a change in product mix at the Group's Aluminium Alloy Extruded Products Division, which reported gross profit margin of 22.7% for 2Q2013, compared to 32.3% for 2Q2012.

Other operating income, which comprised interest income and disposal of scrap materials, rose 144.1% to RMB9.6 million for the review quarter, from RMB4.0 million for 2Q2012, due to higher income from disposal of scrap materials.

In line with the higher business activities, selling and distribution expenses rose 51.9% to RMB10.7 million for 2Q2013, largely due to an increase in transportation costs. Administrative expenses rose 12.5% to RMB26.8 million in 2Q2013, from RMB23.8 million for 2Q2012, due mainly to higher operating costs and start-up costs at both our Luoyang Aluminium Alloy Extruded Products Division and Aluminium Alloy Plates and Sheets Division.

Approximately RMB10.7 million (2Q2013: RMB9.4 million) of the interest on bank borrowings that were used to finance the construction of property, plant and equipment for the new production lines were capitalised.

The Group also recorded a share of profit from its associated company Nanjing SR Puzhen Rail Transport Co., Ltd. ("NPRT"), which contributed approximately RMB3.1 million for 2Q2013, swinging around from a share of loss in the corresponding financial period. This was mainly the result of increased train car deliveries during the review period.

As a result of the above, the Group reported a net profit attributable to shareholders of RMB14.9 million. The Group's balance sheet remains healthy, with cash and cash equivalents of RMB416.7 million as at June 30, 2013.

Patrick Chew, Chief Executive Officer of Midas, said, "The improved financial performance for this quarter was the result of improving demand for the Group's products and our efforts to capture business opportunities both in the PRC and in regional markets. In view of the increased confidence in our business prospects and growth and as a gesture of our appreciation to Midas shareholders for their support, the Board is pleased to declare an interim dividend of 0.25 Singapore cent per ordinary share."

For the half year ended June 30, 2013 ("1H2013"), the Group reported a Net Profit of RMB10.0 million, on the back of an 8.0% increase in revenue to RMB486.4 million. This compares against a Net Profit of RMB16.9 million and revenue of RMB450.2 million for the corresponding financial period.

Outlook

The PRC Government's pledge to speed up railway investments and China Railway Corporation's ("CRC") plan to raise annual investments in fixed assets to RMB660 billion in 2013[1] are expected to benefit industry players.

[1] http://in.reuters.com/article/2013/08/08/china-economy-railway-idINL4N0G92KZ20130808

In view of the above, the Group remains moderately optimistic on the outlook of China's railway industry over the mid to long-term. At the export front, the Group continues to make good progress in its strategy to grow its businesses, securing additional projects for the Russian and Singapore markets in early 2013. Moving forward, the Group will continue to actively identify and harness opportunities in other product segments as well as in export markets.

"We are optimistic that continued business opportunities in both China and regional markets will continue to benefit market players. In addition, our leading position as an established supplier noted for delivering quality products and services will continue to position Midas well to harness these growth opportunities," Mr Chew concluded.

About Midas Holdings Limited

Founded in 2000, Midas is today the leading manufacturer of aluminium alloy extrusion products for the passenger rail transportation sector in the PRC. Over the years, Midas has built an established track record in supplying to the PRC passenger rail transportation sector, which includes participation in landmark contracts such as trains for the Beijing-Tianjin High Speed Train Project, and inter-city high speed trains for the CRH3-380 Project. Midas' customers include domestic PRC licensed train manufacturers from China South Locomotive & Rolling Stock Corporation Limited and China CNR Corporation Limited, as well as international customers such as Alstom Transport, Siemens AG and Bombardier Transportation.

Midas has a strategic 32.5% stake investment in Nanjing SR Puzhen Rail Transport Co., Ltd. ("NPRT"), an associate company engaged in the development, manufacturing and sale of metro trains, bogies and their related parts.

In 2012, Midas was honoured with the 'Supplier of the Year Award' by Bombardier Transportation, one of the world’s leading manufacturers of innovative aerospace and rail transport solutions. In recognition of its consistent growth and profitability, Midas was included in Forbes Asia's "Best Under A Billion" list for four consecutive years from 2006 to 2009. The Company was also awarded the "Best Investor Relations Award (Gold)" at the Singapore Corporate Awards 2010 in the "S$300 million to less than S$1 billion market capitalisation" category. As testament to its strong brand name and reputation in the PRC, Midas was conferred the prestigious "China Well-Known Trademark" by the Trademark Office of the State Administration for Industry & Commerce of the PRC ("SAIC") in 2011.

Midas has a primary listing on the Mainboard of the Singapore Exchange Securities Trading Limited and a secondary listing on the Main Board of the Stock Exchange of Hong Kong Limited.

Source: Midas Holdings Limited
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