BEIJING, May 12 /PRNewswire-Asia/ -- China TransInfo Technology Corp., (Nasdaq: CTFO) ("China TransInfo" or "the Company"), a leading provider of public transportation information systems technology and comprehensive solutions in the People's Republic of China ("PRC"), today reported its financial results for the quarter ended March 31, 2009.
First Quarter 2009 Highlights
-- Sales increased 40.3% year-over-year to $6.5 million
-- Gross profit increased 39.7% year-over-year to $3.3 million, or
51.0% of sales
-- Operating income decreased 15.8% year-over-year to $1.5 million
-- Net income decreased 15.6% year-over-year to $1.4 million, or $0.06
per fully diluted share
-- Non-GAAP adjusted net income was $1.5 million, or $0.07 per fully
diluted share
-- Signed a one-year taxi advertisement placement agreement with a
total value of RMB 1.1 million (approximately $0.2 million) in
Huhhot
-- Signed a contract to provide real-time traffic data mapping software
add-ons to Motorola China mobile phones
-- Completed corporate restructuring to more clearly separate the
Company's business segments and centralize business management
"In the first quarter of 2009, we continued to see strong demand in our business sectors, allowing us to achieve solid top line growth. As part of the RMB 4 billion (approximately $586 billion) economic stimulus plan initiated by the Chinese central government at the end of 2008, the domestic transportation sector is expected to see a boost in public spending over the next several years," said Mr. Shudong Xia, chief executive officer of China TransInfo. "Aside from healthy growth in our normal business operations, we have made substantial investments in the research of new technology and products directed towards the consumer market. We believe that these short term increases in R&D spending will strengthen our position in the long term."
First Quarter 2009 Results
For the quarter ended March 31, 2009, revenue was $6.5 million, a 40.3% increase from $4.6 million during the same period of 2008. This was primarily due to the increase in sales of products and applications in the transportation sector, which accounted for 72.7% of total revenue, up from 46.6% a year ago. The Digital City business segment contributed 26.6% of total revenue while Land and Resources accounted for less than 1.0%, compared to 41.3% and 11.4% in the same quarter of last year, respectively. The Company's bid-win rate was about 90% during the quarter, same as that during the same period in 2008.
Gross profit increased 39.7% to $3.3 million in the three months ended March 31, 2009 compared to $2.4 million in the prior year period. Gross margin was 51.0% as compared to 51.3% during the same period in 2008. The slight decrease in gross margin was due to the slight increase in sales of lower margin hardware components as a percentage of total revenue during the three months ended March 31, 2009.
Selling, general and administrative expenses in the first quarter of 2009 were $1.9 million, an increase of 187.7% from $0.6 million in the first quarter of 2008. Among the SG&A expenses, selling expenses were about $0.4 million in the first quarter of 2009 as compared to $0.2 million in the same period of 2008. This increase resulted from the Company's expanded business scale as well as increased marketing activities to promote China TransInfo's brand recognition in the domestic transportation information industry.
During the first quarter of 2009, the Company spent $1.5 million, or 23.1% of total revenue, on administrative expenses, a 214.6% increase from $0.5 million in the first quarter of 2008. The increase in administrative expenses was due to increased staffing and expenses associated with being a public company as well as a significant increase in research and development efforts for the real time transportation platform and applications.
Operating income decreased 15.8% to $1.5 million, or 22.4% of the revenue, from $1.7 million, or 37.3% of the revenue, in the first quarter of 2008.
Net income decreased to $1.4 million in the three months ended March 31, 2009, or $0.07 per basic and $0.06 per fully diluted share, as compared to net income of $1.7 million, or $0.09 per basic and fully diluted share, during the same period in 2008. Adjusted net income excluding non-cash expenses such as share based compensation and amortization of intangible assets from acquisitions was $1.5 million, or $0.07 per share on a fully diluted basis.
Fully diluted shares outstanding increased from 19.9 million shares in the first quarter of 2008 to 22.3 million shares in the first quarter of 2009 as a result of the acquisition and issuance of additional shares from a private placement in July 2008.
Financial Condition
As of March 31, 2009, cash and restricted cash totaled $13.4 million, down from $17.3 million on December 31, 2008. On March 31, 2009, the Company had working capital of $33.0 million and a current ratio of 4.1. Stockholders' equity totaled $49.0 million as of March 31, 2009, compared to $47.6 million at the end of 2008.
Net cash used in operations was $3.8 million for the three months ended March 31, 2009, compared with net cash provided by operations of $0.9 for the same period in 2008. This was mainly due to an increase in restricted cash and the cost of estimated earnings in excess of billings on uncompleted contracts as well as a decrease in accounts payable in the quarter compared to the same period of 2008.
Recent Events
-- April 2009 -- Ten of the Company's transportation information
products and applications were included on the Beijing Municipal
Government's most recent procurement list
-- April 2009 -- The Company signed a contract with the Beijing
Transportation Information Center with a total value of RMB 12.2
million, or approximately $1.8 million to construct the Beijing
Transportation Information Center's Transportation Industry Data
Center System Database
-- April 2009 -- The Company signed contracts in Gansu Province and
Shanxi Province with a combined value of roughly RMB 16.0 million,
or approximately $2.3 million to construct the Gansu Transportation
Geographic Information System (GIS) platform for the Gansu
Provincial Ministry of Communication and a customized GIS platform
for the Shanxi Provincial Department of Forestry
-- April 2009 -- The Company's board of directors adopted the 2009
Equity Incentive Plan which is subject to shareholder approval at
the Annual Shareholder Meeting
-- May 2009 -- The Company announced that the Company will hold its
2009 Annual Shareholder Meeting at 9:00 am (Beijing Time), on May 29,
2009 at the Company's headquarters in Beijing
Business Outlook
"The Chinese government's determination to develop a modern, nationwide transportation infrastructure has given us tremendous growth opportunities. At China TransInfo, we are dedicated to becoming the leading transportation information solution and application provider in terms of both business scale and technology. We will continue working on the development of cutting edge technologies to ensure our products are the most sophisticated on the market," commented Mr. Xia. "As we continue to expand our transportation business, we were encouraged to see that 10 of our products and services were included on the Beijing Municipal Government's most recent procurement list, up from five last year. We view the steady stream of repeat business to be one of the strongest endorsements of the quality of our offerings."
For the fiscal year ending December 31, 2009, China TransInfo is reaffirming its previously stated guidance of approximately $45.0 million in revenues and net income of approximately $13.0 million.
Conference Call
The Company will host a conference call at 08:00 a.m. Eastern Time on May 12, 2009 to discuss its first quarter 2009 results. To participate in the live conference call, please dial the following number five to ten minutes prior to the scheduled conference call time: 1-888 339-2688. International callers should dial +1-617-847-3007. When prompted by the operator, mention conference pass code 570 635 44.
If you are unable to participate in the call at this time, a replay will be available for 14 days after the call is held. To access the replay, dial 1-888-286-8010. International callers should dial +1-617-801-6888. The conference pass code is 478 545 36.
In addition, the call will be broadcast live over the internet via the following link: http://www.chinatransinfo.com/event_calendar.html
Please go to the webcast via the link 10 minutes prior to the start of the call to register. The webcast of the call will be available through the same link for up to a year after the call occurs.
Use of Non-GAAP Financial Information
GAAP results for the three month periods ended March 31, 2009 include
non-cash share based compensation and amortization of intangible assets from acquisitions. To supplement the Company's condensed consolidated financial statements presented on a GAAP basis, the Company has provided non-GAAP financial information, which is adjusted net income and adjusted earnings per share, excluding the impact of these items in this release. The Company's management believes that these non-GAAP measures provide investors with a better understanding of how the results relate to the Company's historical performance. A reconciliation of adjustments to GAAP results appears below. This additional non-GAAP information is not meant to be considered in isolation or as a substitute for GAAP financials. The non-GAAP financial information that the Company provides also may differ from the non-GAAP information provided by other companies.
About China TransInfo
China TransInfo, through its affiliate, China TransInfo Technology Group Co., Ltd., (the "Group Company") and the Group Company's PRC operating subsidiaries, is primarily focused on providing transportation information services. The Company aims to become the largest transportation information product and comprehensive solutions provider, as well as the largest integrated transportation information platform and commuter traffic media platform builder and operator in China. China TransInfo is involved in developing multiple applications in transportation, digital city, land and resource filling system based on GIS technologies which is used to service the public sector. In addition, the Company is developing its transportation system to include ETC technology. As the co-formulator to several transportation technology national standards, the Company has software copyrights for up to 75 software products and has won 5 of 10 model cases sponsored by PRC Ministry of Communications. The Company's affiliation with Peking University provides the Company access to the University's GeoGIS Research Laboratory, including 30 Ph.D. researchers. As a result, the Company is currently playing a key role in setting the standards for electronic transportation information solutions. For more information please visit the Company website at http://www.chinatransinfo.com .
Safe Harbor Statement
This press release contains certain statements that may include "forward looking statements". All statements other than statements of historical fact included herein are "forward-looking statements". 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. 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. You 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 periodic 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.
--FINANCIAL TABLES FOLLOW--
CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
Three Months Ended March 31,
2009 2008
Revenues $6,513,395 $4,641,249
Cost of revenues 3,190,897 2,262,425
Gross profit 3,322,498 2,378,824
Operating Expenses 1,865,719 648,400
Income from operations 1,456,779 1,730,424
Other income (expense):
Interest income 13,739 15,228
Interest expense (45,721) --
Subsidy income 29,302 --
Other expenses - net (195) --
Total other income (expense) (2,875) 15,228
Net income before income taxes 1,453,904 1,745,652
Income tax expenses:
Current 3,296 --
Deferred (3,417) (65,607)
Total income tax expense
(benefit) (121) (65,607)
Net income including noncontrolling
interest 1,454,025 1,811,259
Less: Net income attributable to
noncontrolling interests 5,339 93,962
Net income attributable to CTFO $1,448,686 $1,717,297
Weighted average CTFO shares of
outstanding -
basic 22,187,314 19,601,107
diluted 22,297,228 19,853,523
Earnings per share attributable to
CTFO common shareholders -
basic $0.07 $0.09
diluted $0.06 $0.09
Comprehensive income
Net income including noncontrolling
interest $1,454,025 $1,811,259
Translation adjustments (165,950) 836,012
Comprehensive income $1,288,075 $2,647,271
Comprehensive income attributable
to noncontrolling interest $5,339 $93,962
Comprehensive income attributable
to CTFO $1,282,736 $2,553,309
CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEET
March 31, 2009 December 31, 2008
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $10,621,010 $16,122,464
Restricted cash 2,753,262 1,209,542
Accounts receivable, net 7,331,280 7,735,742
Inventory 611,554 23,775
Cost and estimated earnings
in excess of billings on
uncompleted contracts 15,440,856 11,912,285
Prepayments 3,880,485 3,647,731
Other receivable 2,517,175 2,940,404
Deferred tax assets 214,836 211,708
Other current assets 316,115 --
Total current assets 43,686,573 43,803,651
Long-term investment 717,850 278,730
Property and equipment, net 10,152,205 9,874,005
Intangible assets, net 1,881,825 1,490,807
Goodwill 3,090,797 3,095,017
Other non-current assets 159,607 147,607
Total assets $59,688,857 $58,689,817
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $4,579,931 $5,518,402
Notes payable 2,930,000 2,934,000
Due to related parties 309,333 528,485
Billings in excess of costs
and estimated earnings on
uncompleted contracts 1,533,530 846,971
Deferred revenue 18,519 214,256
Other payable and accrued
liabilities 1,297,411 1,030,766
Total current liabilities 10,668,724 11,072,880
Commitments and contingencies
Stockholders' equity:
China TransInfo Technology Corp.
Preferred stock, par value
$0.001 per share, 10,000,000
shares authorized and 0 shares
issued and outstanding -- --
Common stock, par value $0.001
per share, 150,000,000 shares
authorized , 22,187,314 issued
and outstanding 22,187 22,187
Additional paid-in capital 24,808,129 24,654,890
Retained earnings 20,422,910 18,974,224
Accumulated other comprehensive
gain - translation adjustments 2,333,943 2,499,893
Total China TransInfo
Technology Corp. shareholders'
equity 47,587,169 46,151,194
Noncontrolling interest 1,432,964 1,465,743
Total stockholders' equity 49,020,133 47,616,937
Total liabilities and stockholders'
equity $59,688,857 $58,689,817
CHINA TRANSINFO TECHNOLOGY CORP. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL DATA
For the For the
Three Months ended Three Months ended
Adjusted Net income March 31, 2009 March 31, 2008
($)
Net Income Diluted EPS Net Income Diluted EPS Net Income Diluted EPS
Adjusted Amount 1,512,706 0.07 1,760,033 0.09
Adjustments
Amortization of
intangible assets from
acquisitions (1) 4,359 0.00 -- --
Non-cash share based
compensation 59,661 0.00 42,736 0.00
Amount per consolidated
statement of operations 1,448,686 0.06 1,717,297 0.09
(1) Amortizations of intangible assets from acquisitions for Q1 2009
includes amortizations of intangible assets from acquisitions of China
TranWiseway in 2008
For more information, please contact:
China TransInfo Technology Corp.
Ms. Fan Zhou, Director of IR
Phone: +86-10-8267-1299 x8033 (Beijing)
Email: ir@ctfo.com
CCG Investor Relations Inc.
Mr. Crocker Coulson, President
Phone: +1-646-213-1915 (New York)
Email: crocker.coulson@ccgir.com
Graham Reed, Financial Writer
Tel: +1-646-213-1907
Email: graham.reed@ccgir.com
Web: http://www.ccgirasia.com
