NEW YORK, May 14, 2013 /PRNewswire/ -- Global Sources Ltd. (NASDAQ: GSOL) reported financial results for the first quarter ended March 31, 2013.
Global Sources' executive chairman, Merle A. Hinrich, said: "Our first quarter results reflect the soft and uncertain overseas demand for exports. In April, we entered into an agreement to acquire an interest in the Shenzhen International Machinery Manufacturing Industry Exhibition and its related shows (SIMM). SIMM expands our portfolio of domestic trade shows in mainland China and gives us a strong presence in a large and growing market sector. We look forward to developing the show and maximizing synergies with our other businesses."
Financial highlights - First quarter: 2013 compared to 2012
Global Sources' CFO, Connie Lai, said: "In the first quarter, we took action to reduce operating expenses. Also, our bottom line benefitted from the sale of an office property in Hong Kong, which we announced in March 2013 with final payment of $8 million received on April 2, 2013. We intend to continue our efforts to strike the right balance between investing for the future and prudently managing costs.
"With respect to our cash position, we completed the acquisition of the property in Hong Kong in the first quarter of 2013 that resulted in a reduction of cash by $24.7 million. We are also scheduled to complete the sales of our property in Shenzhen in the second quarter of 2013 that is expected to increase our cash by $16.3 million."
Updated financial expectations for the first half of 2013 under IFRS
The company is increasing its first half 2013 guidance due primarily to stronger than expected revenue performance and cost savings.
"We now expect the revenue mix for the first half to range between 51% and 52% for online, 37% and 38% for exhibitions, 6% and 7% for print, and approximately 4% for miscellaneous. This compares to a first half 2012 revenue mix of approximately 58% for online, 31% for exhibitions, 8% for print and 3% for miscellaneous," Lai concluded.
Recent Corporate Highlights
Conference call for Global Sources first quarter 2013 earnings
Executive Chairman Merle A. Hinrich and CFO Connie Lai are scheduled to conduct a conference call at 8:00 a.m. ET May 14, 2013 (8:00 p.m. on May 14, 2013 in Hong Kong) to review these results in more detail. Investors in the United States may participate in the call by dialing (877) 941-1427, and non-Hong Kong international participants may dial (1-480) 629-9664. Investors in Hong Kong may participate by dialing (852) 3009-5027. The conference ID is 4613639 and participants are encouraged to dial 10 minutes prior to the call to prevent a delay in joining. A live webcast of the conference call is scheduled to be available on Global Sources' corporate site at http://www.investor.globalsources.com.
For those who cannot listen to the live broadcast, a webcast replay of the call is scheduled to be available on the company's corporate site for 30 days. A telephone replay of the call is also scheduled to be available through May 22, 2013. To listen to the telephone replay dial (800) 406-7325 or dial (1-303) 590-3030 outside the United States, and enter pass code 4613639. For those in the Hong Kong area, the replay dial-in number is (852) 3056-2777, and the pass code is 4613639.
About Global Sources
Global Sources is a leading business-to-business media company and a primary facilitator of trade with Greater China.
The core business facilitates trade between Asia and the world using English-language media such as online marketplaces (GlobalSources.com), print and digital magazines, sourcing research reports, private sourcing events, trade shows, and online sourcing fairs.
More than 1 million international buyers, including 95 of the world's top 100 retailers, use these services to obtain product and company information to help them source more profitably from overseas supply markets. These services also provide suppliers with integrated marketing solutions to build corporate image, generate sales leads and win orders from buyers in more than 240 countries and territories.
Global Sources' other businesses provide Chinese-language media to companies selling to and within Greater China. These services include online web sites, print and digital magazines, seminars and trade shows. In mainland China, Global Sources has a network of more than 30 office locations and a community of more than 4 million registered online users and magazine readers of its Chinese-language media.
Now in its fifth decade, Global Sources has been publicly listed on the NASDAQ since 2000.
Global Sources' non-IFRS metrics
Management believes non-IFRS metrics are useful measures of operations and provides IFRS to non-IFRS reconciliation tables at the end of this press release. Global Sources defines non-IFRS net income as net income excluding non-cash, SBC expense or credit, amortization of intangibles as it relates to certain equity compensation plans, profits or losses on acquisitions and investments net of transaction costs and related tax expenses, and/or impairment charges, for all historical and future references to non-IFRS metrics. Non-IFRS EPS is defined as non-IFRS net income divided by the weighted average of diluted common shares outstanding. Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, amortization, stock-based compensation, impairment of goodwill and intangible assets, and profits or losses on acquisitions and investments net of transaction costs and related tax expenses.
Safe Harbor Statement
This news release contains forward-looking statements within the meaning of Section 27-A of the Securities Act of 1933, as amended and Section 21-E of the Securities Exchange Act of 1934, as amended. The company's actual results could differ materially from those set forth in the forward-looking statements as a result of the risks associated with the company's business, changes in general economic conditions, and changes in the assumptions used in making such forward-looking statements.
- Tables Follow -
GLOBAL SOURCES LTD. AND SUBSIDIARIES | |||||||
As at March 31, | As at December 31, | ||||||
2013 | 2012 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 86,321 | $ | 104,631 | |||
Term deposits with banks | 2,574 | 4,184 | |||||
Financial assets, available-for-sale | 7,535 | 7,472 | |||||
Accounts receivables | 3,743 | 4,242 | |||||
Receivables from sales representatives | 12,118 | 7,773 | |||||
Inventories | 360 | 410 | |||||
Prepaid expenses and other current assets | 33,119 | 18,396 | |||||
145,770 | 147,108 | ||||||
Non-current assets | |||||||
Property and equipment | 49,723 | 30,442 | |||||
Investment properties | 96,994 | 97,377 | |||||
Intangible assets | 32,441 | 33,136 | |||||
Long term investment | 100 | 100 | |||||
Deferred income tax assets | 248 | 244 | |||||
Other non-current assets | 3,364 | 2,762 | |||||
182,870 | 164,061 | ||||||
Total assets | $ | 328,640 | $ | 311,169 | |||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
Current liabilities | |||||||
Accounts payable | $ | 8,426 | $ | 12,531 | |||
Deferred income and customer prepayments | 99,413 | 84,540 | |||||
Accrued liabilities | 20,084 | 20,409 | |||||
Income tax liabilities | 865 | 1,225 | |||||
128,788 | 118,705 | ||||||
Non-current liabilities | |||||||
Deferred income and customer prepayments | 10,570 | 9,062 | |||||
Deferred income tax liabilities | 5,970 | 6,090 | |||||
16,540 | 15,152 | ||||||
Total liabilities | 145,328 | 133,857 | |||||
Equity attributable to Company's shareholders | |||||||
Common shares | 524 | 521 | |||||
Treasury shares | (150,089) | (150,089) | |||||
Other reserves | 157,328 | 156,629 | |||||
Retained earnings | 164,480 | 158,859 | |||||
Total Company shareholders' equity | 172,243 | 165,920 | |||||
Non-controlling interests | 11,069 | 11,392 | |||||
Total equity | $ | 183,312 | $ | 177,312 | |||
Total liabilities and equity | $ | 328,640 | $ | 311,169 | |||
GLOBAL SOURCES LTD. AND SUBSIDIARIES | |||||||||||||||||||||||||||
CONSOLIDATED INCOME STATEMENTS | |||||||||||||||||||||||||||
(In U.S. Dollars Thousands, Except Number of Shares and Per Share Data) | |||||||||||||||||||||||||||
Three months ended March 31, | |||||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||||||||||||||
Revenue | |||||||||||||||||||||||||||
Online and other media services (Note 1) | $ | 27,959 | $ | 35,223 | |||||||||||||||||||||||
Exhibitions | 1,501 | 2,217 | |||||||||||||||||||||||||
Miscellaneous | 1,792 | 1,477 | |||||||||||||||||||||||||
31,252 | 38,917 | ||||||||||||||||||||||||||
Operating Expenses: | |||||||||||||||||||||||||||
Sales (Note 2) | 10,993 | 15,034 | |||||||||||||||||||||||||
Event production | 396 | 326 | |||||||||||||||||||||||||
Community and content (Note 2) | 6,185 | 6,928 | |||||||||||||||||||||||||
General and administrative (Note 2) | 9,792 | 10,174 | |||||||||||||||||||||||||
Information and technology (Note 2) | 3,314 | 3,391 | |||||||||||||||||||||||||
Total Operating Expenses | 30,680 | 35,853 | |||||||||||||||||||||||||
Profit on sale of property | 4,457 | - | |||||||||||||||||||||||||
Profit from Operations | 5,029 | 3,064 | |||||||||||||||||||||||||
Interest income | 274 | 186 | |||||||||||||||||||||||||
Share of loss of associate | - | (14) | |||||||||||||||||||||||||
Profit before income taxes | 5,303 | 3,236 | |||||||||||||||||||||||||
Income tax expense | (26) | (163) | |||||||||||||||||||||||||
Net profit | $ | 5,277 | $ | 3,073 | |||||||||||||||||||||||
Net loss attributable to non-controlling interests | 344 | 32 | |||||||||||||||||||||||||
Net profit attributable to the Company's shareholders | $ | 5,621 | $ | 3,105 | |||||||||||||||||||||||
Diluted net profit per share attributable to the Company's shareholders | $ | 0.16 | $ | 0.09 | |||||||||||||||||||||||
Shares used in diluted net profit per share calculations | 35,914,192 | 35,573,189 | |||||||||||||||||||||||||
Note: 1. | Online and other media services consists of: | ||||||||||||||||||||||||||
Three months ended March 31, | |||||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||||||||||||||
Online services | $ | 24,975 | $ | 30,877 | |||||||||||||||||||||||
Print services | 2,984 | 4,346 | |||||||||||||||||||||||||
$ | 27,959 | $ | 35,223 | ||||||||||||||||||||||||
Note: 2. | Non-cash compensation expenses associated with the several equity compensation plans and | ||||||||||||||||||||||||||
Global Sources Directors Share Grant Award Plan included under various categories of | |||||||||||||||||||||||||||
expenses are as follows: | |||||||||||||||||||||||||||
Three months ended March 31, | |||||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||||||||||||||
Sales | $ | 68 | $ | 62 | |||||||||||||||||||||||
Community and content | (41) | (35) | |||||||||||||||||||||||||
General and administrative | 229 | 265 | |||||||||||||||||||||||||
Information and technology | 85 | 72 | |||||||||||||||||||||||||
$ | 341 | $ | 364 |
GLOBAL SOURCES LTD. AND SUBSIDIARIES | ||||||||
ACTUAL IFRS to NON-IFRS RECONCILIATION | ||||||||
(In U.S. Dollars Thousands, Except Number of Shares and Per Share Data) | ||||||||
Three months ended March 31, | ||||||||
2013 | 2012 | |||||||
IFRS EPS | $ | 0.16 | $ | 0.09 | ||||
IFRS Net Profit | $ | 5,621 | $ | 3,105 | ||||
Non-cash stock based compensation expense (Note 1) | 341 | 364 | ||||||
Amortization of intangibles (Note 2) | 254 | 191 | ||||||
Profit on sale of property | (4,457) | - | ||||||
Non-IFRS Net Profit | $ | 1,759 | $ | 3,660 | ||||
Non-IFRS diluted net profit per share | $ | 0.05 | $ | 0.10 | ||||
Total shares used in non-IFRS diluted net profit per share calculations | 35,914,192 | 35,573,189 | ||||||
Notes: | ||||||||
(1) Actual SBC is calculated based on actual share price on date of the awards. | ||||||||
(2) Amortization of intangible assets relating to certain non-compete agreements. | ||||||||
GLOBAL SOURCES LTD. AND SUBSIDIARIES | ||||||||
ADJUSTED EBITDA RECONCILIATION | ||||||||
(In U.S. Dollars Thousands) | ||||||||
Three months ended March 31, | ||||||||
2013 | 2012 | |||||||
IFRS profit from operations | $ | 5,029 | $ | 3,064 | ||||
Depreciation and amortization | 2,270 | 1,964 | ||||||
EBITDA | 7,299 | 5,028 | ||||||
Non-cash stock based compensation expense | 341 | 364 | ||||||
Profit on sale of property | (4,457) | - | ||||||
Adjusted EBITDA | $ | 3,183 | $ | 5,392 | ||||
GLOBAL SOURCES LTD. AND SUBSIDIARIES | ||||||
GUIDANCE IFRS to NON-IFRS RECONCILIATION | ||||||
(In U.S. Dollars Million, Except Number of Shares and Per Share Data) | ||||||
GUIDANCE | ACTUAL | |||||
Six months | Six months | |||||
ended June 30, | ended June 30, | |||||
2013 | 2012 | |||||
Revenue | $89.0 | to | $91.0 | $105.7 | ||
IFRS EPS | $0.59 | to | $0.63 | $0.36 | ||
Non-cash stock based compensation expense (Note 1) | $0.03 | $0.03 | $0.03 | |||
Amortization of intangibles (Note 2) | $0.01 | $0.01 | $0.01 | |||
Impairment loss on investment in associate | - | - | $0.01 | |||
Gain on sale of investment property, net of transaction costs & related tax expenses | ($0.36) | ($0.36) | - | |||
Non-IFRS diluted net income per share | $0.27 | to | $0.31 | $0.41 | ||
Total shares used in non-IFRS diluted net income | ||||||
per share calculations | 36,130,000 | 36,130,000 | 35,716,189 | |||
Notes: | ||||||
(1) Actual SBC is calculated based on actual share price on date of the awards. | ||||||
(2) Amortization of intangible assets relating to certain non-compete agreements. |
For financial matrix, please visit: http://www.prnasia.com/sa/attachment/2013/05/20130514093942266299.pdf
Press Contact in Asia | Investor Contact in Asia |
Camellia So | Connie Lai |
Tel: (852) 2555-5021 | Tel: (852) 2555-4747 |
e-mail: cso@globalsources.com | e-mail: investor@globalsources.com |
Press Contact in U.S. | Investor Contact in U.S. |
Brendon Ouimette | Cathy Mattison |
Tel: (1-480) 664-8309 | |
e-mail: bouimette@globalsources.com | Tel: (1-415) 433-3777 |
e-mail: cmattison@lhai.com | |