omniture

ACL Semiconductors Reports 18% Revenue Increase for Second Quarter 2010

ACL Semiconductors, Inc.
2010-08-24 03:32 960
-- Positioned as a Leading Distributor of Samsung Memory Products in Southern China --

-- Sees Gradual Increase of Global Demand for Memory Products in Second Half 2010 --

    HONG KONG, Aug. 24 /PRNewswire-Asia/ -- ACL Semiconductors (OTC Bulletin Board: ACLO.OB), a leading China-based distributor of Samsung memory electronic products in Hong Kong and Southern China, reported financial results for the second quarter ended June 30, 2010.

    Quarterly Highlights:
    -- Net revenue up 18% year over year to $89.53 million
    -- Gross margin at 2.2%
    -- Diluted earnings per share at $0.02 compared to $0.04 a year ago
    -- Over 150 customers in Hong Kong and Southern China


    Mr. Alan Yang, Chairman and Chief Executive Officer of ACL Semiconductors, commented, "We are excited to report another quarter of year-over-year revenue growth. In the second quarter our total sales turnover was up 18% as compared to the previous year quarter. These outstanding results reflect the success of our business model and the macro economic factors across Hong Kong and Southern China. Momentum there in the electronic sector particularly for memory products continues into the third quarter as demand for consumer electronics remains robust."
    For the second quarter of 2010, ACL Semiconductors reported net revenue of $89.53 million, increase from $75.83 million for the second quarter 2009. The year over year revenue growth was primarily due to an increase of sales volume in the PRC market. Net income for the second quarter ended June 30, 2010 was $593,895 compared to net income of $1.1 million for the second quarter of 2009. Earnings per diluted share was $0.02 for the second quarter 2010, as compared to $0.04 in the year ago quarter.
    Gross profit for the second quarter 2010 was $1.9 million, down 24.6% from $2.5 million for the second quarter 2009 primarily due to lower margins. Gross margin for the second quarter of 2010 was 2.2%, down from 3.6% for the second quarter 2009. The decrease in gross profit and gross margins is mainly due to the decrease in average selling prices as the market became saturated with excess supply. The saturation was due to the excess supply intended for the United States and Europe that was pushed into the China market causing the selling price to decrease.
    Mr. Yang continued, "During the quarter we continued to take initiatives to improve our internal financial performance and minimize unnecessary costs. We recorded a 9.3% decrease in operating expenses and a 4.5% decrease in interest expense, as compared to the corresponding quarter in 2009. We expect the global market demand and average selling price to pick up in the third quarter of 2010 as a result of the broader rebound in the semiconductor market. We are confident in our outlook as the electronics business is expected to grow for the remainder of the year and we are ready to take advantage of the foreseeable growth in China's market. Most importantly, we are proud of the distribution and product research we supply to Samsung as we are positioned to be a leading distributor of Samsung memory products in Southern China."                  

    About ACL Semiconductors
    ACL Semiconductors distributes electronic components under the "Samsung" brand name to the Hong Kong and South China markets. The memory chips are used from everything from a mobile phone, digital camera and laptop computer to an MP3 player or Wi-Fi products. For more information about ACL Semiconductors please visit ACL Semiconductors' corporate website at 
http://www.acl-semicon.com .

    Forward-Looking Statements
    This information contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In particular, when used in the preceding discussion, the words "plan," "confident that," "believe," "scheduled," "expect," or "intend to," and similar conditional expressions are intended to identify forward-looking statements within the meaning of the Act and are subject to the safe harbor created by the Act. Such statements are subject to certain risks and uncertainties and actual results could differ materially from those expressed in any of the forward-looking statements. Such risks and uncertainties include, but are not limited to, market conditions, the availability of components and successful production of the company's products, general acceptance of the company's products and technologies, competitive factors, timing, and other risks described in the company's SEC reports and filings.




                      ACL SEMICONDUCTORS INC. AND SUBSIDIARIES
                 Condensed Consolidated Statements of Income (Unaudited)
                                          
                                Three Months Ended       Six Months Ended
                               June 30,     June 30,    June 30,     June 30,
                                2010         2009         2010         2009
                                          (Restated)               (Restated)


    Net sales
      Related parties       $2,119,515     $159,577   $3,560,951     $475,999
      Other                 87,412,775   75,667,934  184,982,401  137,858,640
      Less discounts to
       customers                    --         (449)          --       (7,438)

                            89,532,290   75,827,062  188,543,352  138,327,201

    Cost of sales           87,601,020   73,273,593  183,785,478  132,915,773

      Gross profit           1,931,270    2,553,469    4,757,874    5,411,428

    Operating expenses
      Selling                   28,586       36,256       53,388       58,434
      General and
       administrative        1,122,719    1,232,737    2,180,589    2,522,190

    Income from operations     779,965    1,284,476    2,523,897    2,830,804

    Other income (expenses)
      Rental income             30,000       22,308       60,000       44,615
      Interest expense        (110,705)    (115,918)    (205,869)    (282,810)
      Management and
       service income           10,884        7,641       19,205       14,180
      Net income on cash
       flow hedge                   --       28,372       15,410       48,721
      Interest income              192        2,312          285       31,022
      (Loss) profit on
       disposal of fixed
       assets                       --       21,350         (308)      21,350
      Exchange differences      (8,754)       7,699      (14,957)       5,555
      Miscellaneous             20,518        5,310       21,479        3,354

    Income before income
     taxes provision           722,100    1,263,550    2,419,142    2,716,791

    Income taxes provision     128,205      179,487      384,271      397,436

    Net Income                $593,895   $1,084,063   $2,034,871   $2,319,355

    Earnings per share -
     basic and diluted           $0.02        $0.04        $0.07        $0.08

    Weighted average number
     of shares -- 
     basic and diluted      28,729,936   28,729,936   28,729,936   28,729,936




                   ACL SEMICONDUCTORS INC. AND SUBSIDIARIES
                Condensed Consolidated Balance Sheets (Unaudited)

                     LIABILITIES AND STOCKHOLDERS' EQUITY
                                                 As of               As of
                                                June 30,         December 31,
                                                  2010                2009
                                              (Unaudited)
    Current liabilities:
      Accounts payable                         $22,023,418       $23,838,753
      Accrued expenses                             451,947           527,582
      Lines of credit and loan facilities       12,645,544         9,013,813
      Current portion of long-term debt            319,530           318,972
      Current portion of capital lease             298,434           318,135
      Income tax payable                           861,012           505,078
      Due to stockholders for converted
       pledged collateral                          112,385           112,385
      Other current liabilities                    159,863           282,475

        Total current liabilities               36,872,133        34,917,193

    Long-term liabilities
      Long-term debts, less current
       portion                                   2,589,265         2,747,981
      Capital lease, less current portion           73,866           146,117
      Deferred tax liabilities                      19,468            19,468

        Total long-term liabilities              2,682,599         2,913,566

    Total Liabilities                           39,554,732        37,830,759

    Stockholders' equity:
      Common stock - $0.001 par value;
       50,000,000 shares authorized;
       28,729,936 issued and outstanding
       as of June 30, 2010 and December
       31, 2009 respectively                        28,730            28,730
      Additional paid in capital                 3,658,627         3,658,627
      Retained earnings                          2,989,056           954,185

        Total stockholders' equity               6,676,413         4,641,542

    Total Liabilities and Stockholders'
     equity                                     46,231,145        42,472,301



                    ACL SEMICONDUCTORS INC. AND SUBSIDIARIES
             Condensed Consolidated Balance Sheets (Unaudited)

                                                  As of             As of
                                                 June 30,        December 31,
                                                   2010              2009
                                                                  (Unaudited)

    Current assets:
      Cash and cash equivalents                 $2,986,215        $2,001,805
      Restricted cash                            2,088,374         2,086,504
      Accounts receivable, net of
       allowance for doubtful accounts of
       $0 for 2010 and 2009                     15,956,010        12,434,386
      Inventories, net                           5,323,246         6,048,116
      Other current assets                         232,453           274,351

        Total current assets                    26,586,298        22,845,162

    Property, equipment and improvements,
     net of accumulated depreciation and
     amortization                                8,261,132         8,179,765

    Other deposits                                 145,159           213,535

    Amount due from Mr. Yang                    11,238,556        11,233,839

    Total Assets                                46,231,145        42,472,301
Source: ACL Semiconductors, Inc.
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